The GTalk history files are not encrypted. They are in a JABBER format, which is similar to HTML, and XML except that the control characters are represented in hexadecimal format.
Try the Decode chat history listed above as a place to start. Or you can open the log file is Notepad and then search for the hexadecimal values and replace them with the ASCII equivalent. The log file is a lot easier to read that way.
In order to do this you'll need to know that the hex control characters start with % and include the 2 characters that immediately follow where the hex value is actually just the two characters (no%).
You'll also need a means to translate that hex value into its corresponding ASCII value. this is usually in the form of an ASCII conversion table. One can be found at
http://www.lookuptables.com.