This is actually a pretty damn *creative* approach to a solution, rather than the "how many pics should we show" debate. I like it!
I do, however, think that there are too many pics on the galleries - it is a bit overwhelming and think of your 'average' surfer who gets confused just turning on his monitor.
Also one of my biggees is NO HARDCORE - you've kept pretty close to that but in gallery 3 you've got a full-sized pic of the girl with the guy's dick stuffed all the way down her throat.
The idea proposed recently about putting hardcore TGP galleries behind an AVS system is also a good one, and I've seen a few people mention in chat rooms and such that they're doing this and it's working very well for them.
Also can't help with the law coming down the pike... eventually all of the hardcore is going to get the majority of the TGPs shut down but if we wait for that we'll all be broke.