Sounds like your download might have gotten corrupted. When you click on the download button, does a dialog box pop up asking if you want to save or open the file? You want to save it to your hard drive. There are Portraits and Logos folders in the My Documents\My Games\GalCiv2 folder where you can put the custom race portraits and logos, respectively.
All mods are required to be in zip files and all portraits and logos should be png files, so the file you're trying to download should be a zip file with one or more png files.
