Kmail will do gpg just fine if you install gpg-agent and pinentry-qt and add "use-agent" without the quotes to ~/.gnupg/gpg.conf (create the file if it doesn't exist). I've tested this with KDE 3.5.5 on Dapper and KDE 3.5.7 on Feisty. There was a compilation bug settings bug in KDE 3.5.2 that makes this very unlikely to work out of the box on Dapper unless you've upgraded your KDE.
Kmail will do gpg just fine if you install gpg-agent and pinentry-qt and add "use-agent" without the quotes to ~/.gnupg/gpg.conf (create the file if it doesn't exist). I've tested this with KDE 3.5.5 on Dapper and KDE 3.5.7 on Feisty. There was a compilation bug settings bug in KDE 3.5.2 that makes this very unlikely to work out of the box on Dapper unless you've upgraded your KDE.