Interpolated Values for Table of Evenly Spaced Points

Dear Exchange,
I am using Postgresql 8.4 with PostGIS 1.4 along with PHP 5.3.
I have two tables: one is a table of evenly spaced x,y points (grid_table)  in a square configuration and a second table (values_table) of random (scatter) x,y points within the same square area however this table has values associated with each point.  I want to assign a value from the values table to each point in the grid table within a specific radius.  I have the following code that seems to work nicely.  However I would really like to take the average of the points in a specific radius and assign that value to the grid point. Any ideas.  Secondly, I would really like to do a Inverse Distance Weighting type of function to assign the values to each grid point.  I know this would be much harder but I would appreciate any ideas.  

$query = "UPDATE grid_table SET values = values_table.values FROM values_table
WHERE ST_DWithin(values_table.the_geom, grid_table.the_geom, 0.000005)";
$query_result = pg_exec($dbconn, $query) or die(pg_errormessage());