Please see the see screen shot. This shows the Log Settings for the Database. Since it is a SQL Server Database stored on a different server, are the logs also stored on the SQL Server?
Yes, all the logs you are showing here refer to database tables. The entries and days settings are thresholds to prevent limitless database growing. E.g., each traffic log database table (there are two of them) may have 50,000 entries.
There is no logging in the file system by default.
If so, I assume I can delete the 2 sem5.* files on the SEPM server since we are not using the embedded Database, is that correct.
To be on the safe side, make backups of the files.
BTW, if the files are still in use, you are not able to delete them. If you can delete them, SEPM doesn't need them