I'm sorry to hear that you are having trouble with Showkase.
Unfortunately, an error 500 is a rather generic internal server error and it's not really specific enough to pinpoint the cause of the problem.
However, from the information you provide, the problem could actually be the permissions that you set (777).
777 permissions should work OK but because they are the most relaxed permissions that you can use, some web servers are configured to actually not respect the 777 permissions and, instead, treat them as a potential security risk which, is this is teh case, could certainly prevent Showkase from functioning.
Under normal circumstances on most web servers, there should actually be no need to set permissions of 777.
Showkase should work perfectly fine with default permissions of 755 for folders and 644 for files.
Try changing permissions to 755/644 (or just reupload Showkase using default permissions if it's easier) and see if this helps.
I hope this helps to resolve your problem.
Please let me know how you get on and if I can be of any further assistance.
If you continue to experience difficulties, then please let me know what type of web server you are installing Showkase on (e.g. Linux vs Windows, Apache vs IIS) and what version of PHP your web server has installed and I'll try to help further.
Also, it might help to check out your web server logs to see if anything more specific than an error 500 has been logged that might point us in the right direction.