I use ufraw to convert the DNG to PNG and then use gimp to correct the barrel distortion in the image, all in batch mode. If you want to do the correction by hand, use the Filters>Distorts>Lens_Distortions filter and play with the MAIN parameter until the image looks right. The value depends on the zoom factor used when taking the image.
I uploaded my batch scripts here:
http://chdk.setepontos.com/index.php?topic=9443.msg98900#msg98900 if you want to take a look. It includes a couple of gimp scripts for distortion correction, which may be all that is useful for Windows users (the scripts are for Unix shells). As waterwingz points out, the gimp stage is slow. It's tolerable for batch processing, but would probably be irksome if you wanted to do each image by hand.
