Starting the Debug Log using the command SET DATABSE PARAMETER and selector 34 creates the file 4DDebugLog_1.txt and saves various information in the file. Where the file is stored is dependent on where the SET DATABSE PARAMETER command is executed.
If the command is executed on the server side, then the file is created in the Logs folder next to the structure file on the server machine.
If the command is executed on the client side, then the file is created on the client machine in the Logs folder within the client cache folder. Here is that location:
Win XP: C:\Documents and Settings\{user_name}\Local Settings\Application Data\4D\{DB_Name}\Logs
Win Vista: C:\Users\{user_name}\local\4D\{DB_Name}\Logs
Mac OS: /Users/{user_name}/Library/Caches/4D/{DB_Name}/Logs