I want to use the provided launcher on a separate install of Quake II as I don't want to introduce any cnflicts between the two sourceports I play about with. My main install runs the Yamagi Quake II source port and the install I wish to set up a launcher for runs on Quake II XP. When I set the exe as Quake2XP.exe in the launcher ini, selecting run or run in safemode on any option causing nothing to happen except the launcher closing. How can I set up the launcher to work on a separate installation?

Be careful with path configure and doublecheck it. Q2Launcher.exe from GOG's will use quake executable not set by ini file, but set in win REGEDIT!

First off, i did uninstall almost all games, and use 'backup' fullrip installed folders, install games to one location copy-moved to another location (with original uninstalled).
There is very few games on GOG not work after that (on ZOOM a bit less, they try make it fully portable).
But some else games with own GOG launchers expand that list of non-portable games. This one one of them. But since my REGEDIT GOG entry almost empty, i use random gameid numbers.

I did uninstall this game too, so my clean Quake-2-Quakd Damage installation also use random game id i set myself.
It supposed be not 5 but 1441704824. I change that number myself, so i did change it where it needed.
I did test which one arguments required. Q2Luncher.exe itself tell start it from link (and what is missing if there is no id there in the link). But it will affect what id number there and use REGEDIT entry link to ini file, not the next one.
Still ini file in link still should be present as well.
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So, this is minimum required information-arguments to start base and\or modded games from differ folders
Here is original link file for GOG (+respective working dir)
"D:\Games\GOG-Temp\Quake-2-Quad-Damage\Q2Launcher.exe" 5 Q2Launcher.ini
Here is my link for folder where two basic sourceports installed (for OpenGl and for Direct3d renders)
"X:\Games\Quake-2x\Q2Launcher.exe" 6 DirectQ2Launcher.ini (at same folder - i use two link and exe in same folder, cause DirectQ2.exe do not require\affect original exe - another sourceport replace original quake2.exe file so i keep old q2.ini file for it - link file still refer to id 6 here, with 5 it will start clean original from GOG-temp folder!)
Here is for folder where a bit larger sourcemod - YamagiQuake 2
"X:\Games\Quake-2x-Yamagi\Q2Launcher.exe" 7 YQ2Launcher.ini

Here is REGEDIT entries
Windows Registry Editor Version 5.00

[HKEY_LOCAL_MACHINE\SOFTWARE\Wow6432Node\GOG.com\Games\5]
"PATH"="D:\\Games\\GOG-Temp\\Quake-2-QuadDamage"
"BUILD"="3"
"gameID"="5"
"VER"="2.0.0.3"
"WORKINGDIR"="D:\\Games\\"

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here is for directq2.exe
Windows Registry Editor Version 5.00

[HKEY_LOCAL_MACHINE\SOFTWARE\Wow6432Node\GOG.com\Games\6]
"PATH"="X:\\Games\\Quake-2x"
"BUILD"="3"
"gameID"="6"
"VER"="2.0.0.3"
"WORKINGDIR"="D:\\Games\\"


(working dir here can be whatever)
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Similar for yamagi with folder path and number change to match what is in link file (id 6->7).

Here is YQ2Launcher.ini file example, middle part of it
<...>
[Group0]
GroupName=Quake 2 (YamagiQuake2 Sourceport mod)
Option01=QuakeII
Option02=GroundZero
Option03=Reckoning
Option04=EraserBot
Option05=EraserBotCTF

[Group1]
GroupName=Quake 2: Extremities Addon's (YamagiQuake2 Sourceport mod)
Option01=ActionQuake2
Option02=Capture
Option03=ChaosDeathmatch
Option04=JailBreak
Option05=Kick
Option06=Powerball
Option07=QWar2
Option08=RailArena
Option09=RedRover
Option10=RocketArena2

[QuakeII]
Name=Quake 2 (YamagiQuake2 Sourceport mod)
Exe={app}/yquake2.exe
paramRUN=''
paramSAFE=+set vid_ref soft +set vid_fullscreen 0 +set sw_mode 0 +set s_wavonly 1
paramDC=+set deathmatch 1 +set dedicated 1
paramJOIN=
paramLISTEN=
paramTEAM=

[GroundZero]
Name=Ground Zero
Exe={app}/yquake2.exe
paramRUN=+set game rogue
paramSAFE=+set game rogue +set vid_ref soft +set vid_fullscreen 0 +set sw_mode 0 +set s_wavonly 1
paramDC=+set game rogue +set deathmatch 1 +set dedicated 1

[Reckoning]
<....>
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I rename Q2Launcher.ini to YQ2Launcher.ini here in YamagiQ2 folder without keeping original file, since i have it in two other Q2 folders.

For first run i use adminmode (and exit from launcher without game starting). For each installation.
Not sure how it should work, but all next run without admin rights do not require REGEDIT VirtualStore location for me. Im on Win7. Probably on differ Windows or update builds that winregistry entries should be copied to VirtualSotre, in that case it should be here
HKEY_CURRENT_USER\Software\Classes\VirtualStore\MACHINE\ \...\