Ruben, I got logging working by manually changing that path. The log now appears, but the information is minimal. Gizmo says it looks like a bad password / user .. but I know that's not the case since I've been logging in fine for many years.
My hunch is that by Setting PERSISTENT_DB_CONNECTION ON I changed something in the database making subsequent logins fail.
Could that be? IF so, how the hell do I recover?