A gallery is a group location for housing files. The files uploaded or stored in the gallery aren't available to other applications in the group (such as a blog). To use a gallery photo in another application, you'd have to download the file from the gallery and then either drag and drop it or insert it.
The number of files and the space a gallery can be nearly limitless (that is, limited only by the parameters of the folder where it is located.) Files can be uploaded, viewed, downloaded, or deleted. To upload to a gallery, you can make use of the gallery's drag and drop capability.
While other applications can use images, a gallery uploads files and allows for download. You can subscribe to RSS for a media gallery. This is only possible in one other application, forums. (Wikis have page notifications and blogs have blog notifications.) A gallery does not store an image used in another application; instead, it is a nearly independent application.
Please follow the instructions in the What is an application? article.