Yes, I posted a bug report on that this morning. Josh, by mistake, put a .htaccess file inside the gpEasy zip download that already contained mod rewrite rules.
Basically what gpEasy needs is just a blank .htacess file to write to; however, the one in the download has the directory already set. . . just delete the info in it and gpEasy will re-generate the correct mod_rewrite rules.
Also, make sure you adjust the index.php file by enabling define('gp_indexphp',false);