Okay, to be honest I was interested in this discussion but now it seems like it has deteriorated. So, I'll say what I have to say and then wish everyone well in arguing!
Whoever it was earlier that said I was equating knowledge:local to Gather Information is dead wrong. They don't overlap at all. I'll give an example.
Party walks into a new town. Bob, an aspiring cultural anthropologist (Meaning he has a few ranks in Knowledge:local) looks around at what he sees in the people. He sees that most people are walking around in long clothing. He also notices that most of the women are wearing scarves. Then, he realizes that almost everyone is wearing some sort of headcovering. So, Bob interprets these things and comes up with a logical conclusion that this particular locality must have a cultural taboo against having an uncovered body. Therefore, to avoid violating the taboo, Bob suggests that the party cover themselves a bit more.
Now, Fred, an aspiring detective (meaning he has ranks in Gather information) decides to test Bob's theory and steps up to a man and asks if the way the party is dressed is offensive to any cultural taboo. The man says yes and explains the origin of the taboo because Fred just has a knack for getting information out of people.
Huh. Imagine that. There is an example where the skills not only don't overlap, but gee, maybe they actually help each other. And, believe it or not, it is not a stretch of the imagination as a DM to give both skills value. Say, for example, that because of Bob's ability to discern the local customs through his training in "old-fashioned cultural anthropology" that we call Knowledge:local - Bob is able to enable his party to avoid the law that requiresdeath to all who enter the town and fail to observe the taboo. Fred not only confirmed Bob's presupposition, but Fred actually makes a friend who happens to need a favor and hires the party to complete a mission for him.
See, it is just about the DMs ability to be flexible. Anyone can come down hard and say "Stupid, that just makes them overlap so you're wrong." But a little patience and imagination can see beyond that conclusion and see how both might enrich the game.
Knowledge skills are about learning. Learning information and managing information. Learning how to interpret life around you. Doesn't have to actually involve interaction. Gather information doesn't demand much knowledge ... but it does demand interaction. They don't need to overlap at all. In fact, they can work hand in hand.