Very simple test here is my site. I set now guests can not view members gallery or any cat only the mobile uploads cat.
http://www.reeftalk.com
You can see you can only see that one pic in both links
http://www.reeftalk.com/gallery
Now login with testing and testing and you see you can see everything in both links so looks like it works fine as stated but again this block was written for vbulletin forumhome not vbportal.