We took on a site about 6 weeks ago that was using URL re-write, and we removed it completely. We then did a lot of work on the site content, optimising everything for the SE's, and we also embedded Rich Snippets code into the Product Info template.
We set up all the Google tools as well, and installed sitemaps XML, then did a major clean up of everything (including image filesize optimisation) and submitted the sitemaps to the SE's about two weeks ago.
The site is now ranking strongly on most desired keywords (pages 2 and 3) and we feel it won't be long (with a few more tweaks) to get it onto page 1 of Google.
URL re-write is completely unnecessary and potentially harmful to SEO. We never, never, never use it. Google LOVES native zencart URL's...
There is no need to EVER install this url rewrite nonsense. Spend your time studying the principles of the SEMANTIC WEB, and look at ways to embed microdata tags into your templates. (SEE: http://purl.org/goodrelations and http://schema.org).


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