There are a couple of different concepts to deal with here:
- Pseudowires: these provide emulated point-to-point layer-2 connectivity.
- L2VPNs which are built using pseudowires. These include Virtual Private LAN Service (VPLS) and IP-Only LAN Service (IPLS).
- L3VPNs, which include BGP/MPLS (RFC 2547bis), IPsec, and Virtual Router based VPNs.
----------- In case 1, pseudowires are built between PE routers or other devices, and provide layer-2 connectivity for CE devices. Pseudowires may be signalled using either LDP (draft martini), BGP (draft kompella), or L2TPv3 depending on the particular implementation you are using.
Cisco implements draft martini pseudowires (called AToM by Cisco) which specify LDP signalling (for VC/PW labels). PE routers still need to have IP connectivity in order to build tunnel LSPs (signalled using LDP/RSVP-TE/TDP) over which the pseudowire can travel between PE routers.
IP connecitivty is almost always provided by OSPF and IS-IS as these two routing protocols are the only ones that have the necessary extensions necessary for MPLS traffic engineering (very desirable when implementing pseudowires). Note that it is also possible to transport draft martini pseudowires over tunneling technologies such as GRE, though this is a pretty uncommon configuration.
Cisco also implements L2TPv3 pseudowires, and again you'll need IP connectivity between PE routers (usually provided via an IGP such as OSPF or IS-IS).
---------- L2VPN including VPLS and IPLS take advantage of pseudowire technologies and other mechanisms to provide multipoint Ethernet connectivity for CE devices. VPLS provides multiprotocol connectivity, but is complex, and IPLS provides IP only connectivity and is less complex.
There are currently three drafts specifying VPLS in the IETF L2VPN working group- one using BGP signalling, one specifying LDP signalling, and one using L2TPv3 (with RADIUS discovery).
LDP and BGP signalled VPLS has been implemented already by a number of vendors (mostly LDP signalled), while L2TPv3 based VPLS and IPLS have yet to be implemented by any vendor that I am aware of.
---------- L3VPNs, of course, provide layer-3 connectivity between CE routers.
Now, to the original question- it should be possible to use BGP to advertise routes between PE routers as long as the draft martini pseudowire that you are configuring is transported over a GRE tunnel. But, having said that, I would personally just stick with an LDP/RSVP-TE tunnel LSP between PE routers, and in that case you should stick with OSPF or IS-IS.
Hope that helps,
CCIE#6280 / CCSI#21051 / JNCIS#121 / etc.