To make a python package, in setup.py, I have the following:

setup(
    name="TowelStuff",
    version='0.1.0',
    author="J. Random Hacker",
    author_email="[email protected]",
    packages=['towelstuff', 'towelstuff.test'],
    scripts=['bin/stowe-towels.py','bin/wash-towels.py'],
    url="http://pypi.python.org/pypi/TowelStuff/",
    license="LICENSE.txt",
    description='Useful towel-related stuff.',
    long_description=open('README.txt').read(),
    install_requires=[
    "Django >= 1.1.1",
    "caldav == 0.1.4",
],
)

So I remade that with my own package description and information. When I build it though I get the following warning:

distutils/dist.py:267: UserWarning: Unknown distribution option:

Does install_requires work only on certain versions?

You need to be using setuptools instead of distutils.

Near the top of your script, try replacing

from distutils.core import setup

with

from setuptools import setup

try:
    from setuptools import setup
except ImportError:
    from distutils.core import setup