[Princeton]

if the PRODUCT is well integrated with vbulletin they will have their own "folder" while having vbulletin in root

optimally, an end-user should NOT be directed to a "folder" (eg. /gallery/index.php); this should be done as a last resort

here's an example of how a gallery application should be set up:
gallery.php (root)
depends on gallery setup but you can also have..
newgalleryreply.php (root)
newgallery.php (root)

all related functions and config files should be in GALLERY folder

I don't know about you but my goal as a site administrator is to

1. decrease workload
2. increase revenue (done by decreasing workload)
3. make site usable (Usability) - a good start would be to create short urls whenever possbile

Please understand that I'm not saying that it is wrong to create "folders" for each application. What I'm saying is that ultimately it will cost you more money if you do (time is money).