Actually, it isn't being "parsed" as in an interpreter language. You simply can't do what you're up to, and there's no reason to do so imo. Just leave the placeholder tokens (the stuff in curly brackets) where they are suppossed to reside in (themes/yourtheme/template.html). After all, you're probably only up to design a coppermine theme that nicely blends into the overall look of your entire website (and maybe contains dynamical menu items). To accomplish this, use the coppermine feature that was designed specifically for this purpose: custom_header and custom_footer_include.
You'll just need to break up your existing overall menu (the stuff that resides in
http://tcos.evildoom.ecwhost.com/gal/) into bits: you'll need to insert the tables of your overall site layout there and your overall menu on the left sidebar.
Looking at
http://tcos.evildoom.ecwhost.com/gal/ I can see that you're using a load of JavaScript (which is not a bright idea for a menu btw., as search engine spiders will not be able to follow the links there).
Bottom line: use a custom theme that matches your overall site's design. I created a preliminary coppermine theme for your that does this (basically based on your HTML plus the stylesheet taken from the hardwired theme). Use it instead of trying to fiddle with the replacement tokens as a base. You'll just need to tweak the stylesheet a bit more.
Attachment "cpg1.4.x_theme_tcos.zip" contains your theme that I built for you, attachment "screenshot.jpg" shows your custom theme in action on my testbed.
Joachim