How to control encodings in pgsql2shp?

I solved this problem by adding 'set pgclientencoding=latin1' (without quotes) to the batch script.

There's the option -W for pgsql2shp that allows you to specify the encoding. You could also look into setting the PGCLIENTENCODING environment variable. Most data sets from either the Dutch CBS or the Dutch Kadaster come in the CP1252 encoding, not Latin1.