My guess would be that you have the files on a case-sensitive file system, and L3P hasn't been designed to support that. On a case-sensitive file system, lg_3034.inc is not the same as LG_3034.INC, so if L3P is looking using lower case, and the files themselves are in upper case (or vice versa), then they won't be found.
Orion suggested you use LDView, so I feel obliged to mention that LDView doesn't look for the LGEO files at all; it simply uses the mapping inside LGEO.xml. So, since LGEO.xml uses lower case for all filenames, then the resulting POV files won't work if your LGEO files are stored on the file system with upper case filenames (unless POV-Ray itself handles this). LDView in Linux handles case sensitivity in LDraw files by searching for files in a case-insensitive fashion if it can't find the files using the original case from the file. Unfortunately, this is slower, but it does work.
Orion suggested you use LDView, so I feel obliged to mention that LDView doesn't look for the LGEO files at all; it simply uses the mapping inside LGEO.xml. So, since LGEO.xml uses lower case for all filenames, then the resulting POV files won't work if your LGEO files are stored on the file system with upper case filenames (unless POV-Ray itself handles this). LDView in Linux handles case sensitivity in LDraw files by searching for files in a case-insensitive fashion if it can't find the files using the original case from the file. Unfortunately, this is slower, but it does work.