You see the original module (and the one I'm still using) does many things at the same time :
1. Read the tracklog and approximate the position each photo was taken at, then update the coordinate stored in the DB.
2. Generate the KML.
3. Less important things like blog notification.
After reading the current source, I see it currently only does 2. In other words, it ignores the tracklog and timezone.
So I guess the workaround is to manually place each photo in the right spot. Perhaps someone will write an "Import tracklog" link + page and if we're really lucky it will support GPX.
On the instructions here: http://codex.gallery2.org/Gallery2:Modules:Gps
If you want your gallery to be geourl.org / a2b.cc compliant, activate the 'gps' block for all your themes. This block is invisible.
I am not finding where to activate this block. I am using the wordpressembeded theme if that helps any.