i have only 1 suggestion for you: do not use Linpus. it is a crippled type of linux. you have already found this out yourself by seeing the version they have of avr-gcc. if you compare that to Debian Squeeze, which is the stable version of Debian, so is generally somewhat behind on software-versions, you'll notice it has 4.3.5 (http://packages.debian.org/squeeze/gcc-avr
if you are really interested in running a proper linux distribution, and you are new to linux and want adequate help, consider using Crunchbang Linux (http://crunchbanglinux.org/
). it has a fantastic helpful community for everyone, from newbie to guruh. it is a lightweight system too, so no unnecessary stuff.
that's about all i can say to help you with this. good luck.