It was a technique that I stumbled across to get around hotlinking protection on certain servers.
If the user did not want to upgrade their account (to lift the hotlink protection) or change hosts, I found that as long as the image filename extension was not .jpg, .gif, etc. (and as long as the reference in 'gallery.xml' matched) then SimpleViewer worked fine and the hotlink protection was no longer an issue.
I created an account on one such host and tried it. It worked.
At the time I changed the file extensions to .zzz but, knowing that some hosts allow only certain file types to be uploaded, I suggested trying a known (but non-image-related) file extension such as .txt.
It might not be ethical or to be recommended but it worked.
It was intended as a last resort.
Sorry to have caused any confusion.
With reference to the original poster in this thread, Felix is absolutely right in that "Gallery Not Found" refers to SimpleViewer not being able to find the 'gallery.xml' file (ie. bad path).
Post a URL to your web site and I'll take a look for you.
SimpleViewer Support Team