I'm posting this in the (probably unlikely) case it may help someone else.
I was having repeated problems trying to connect with GR on WinXP to a new Gallery 2 installation -- kept getting a 404 error from GR.
I was already using GR to connect to an existing Gallery installation without problems, but it would not connect to the new installation (which was embedded in WordPress 2 using WPG2, btw.)
Anyway, I kept checking GalleyRemote.txt for clues, but it wasn't helping. It was also growing quite long and hard to follow. So I deleted all its content, saved it, and tried again. Et voila, I could now connect to the new installation!
It does seem unlikely that simply emptying a log file would fix anything, but it certainly seems to have in this case.
FWIW.