I don't find it difficult to believe that you're having problems with the Zone software, it's been known to be quite buggy, and for the past week, the Nar Shaddaa server has been acting up (lagging), causing almost 100 people to have to relocate to the Cantina room.
I'm glad that you were able to find an alternative. Gamespy Arcade is one of the better alternatives. It seems that you've been misinformed though. Gamespy Arcade is free to use but you will be hit with advertisements after certain commands that you give the program (example: leaving a game room). You only have to pay $20 if you wish to register the program. Most people do not register Gamespy Arcade.
If you're looking for another alternative for playing Jedi Knight and Mysteries of the Sith, you may want to check out Qtracker. Qtracker is a server location program that will start supporting Jedi Knight and Mysteries of the Sith again, starting today sometime.
Remember, the current version of Qtracker does not support JK/MotS, but a version that does supports JK/MotS will be released today, at the latest, according the the creator (Ron Mercer).