The text file is needed by mp4chaps which writes the chapter markers to the m4b file. Earlier versions deleted the file afterwards but before releasing i forgot to uncomment the regarding line in the code - so its a bug and its safe to delete the txt file.
Your ploblem seems to be related to gtkpod/libgpod. Maybe because you use an iphone as for iphones the libgpod development is lagging behind sometimes (the devs dont get enough free iphones to work on ). You should go to http://www.gtkpod.org/ and look for bugs or ask the developers via their mailing list. Im afraid i can cant help you with that problem, sorry.
crabman
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