An update for anyone who is interested.
The original
http://modxcms.com/bugs/task/999 suggested
"Error while inserting event log into database."
occurred only when connecting to second database. This is not true as I have received the same error while processing the same file into the modx database.
The error after making the change
$ds= @mysql_query($sql);
change to
$ds= $this->dbQuery($sql);
results in the following
<< MODx Parse Error >>
<< Execution of a query to the database failed - MySQL server has gone away >>
The CSV file is still imported despite the error. This followed by a browser crash of firefox 2.0.0.12 on Vista.