If you are not familiar with using htaccess, the instructions below will help you check that mod_rewrite is available on your server and then allow you to install an htaccess file containing the modifications described in this post. The instructions assume that if you already have an htaccess file in use on your site, it is the standard one supplied as part of the Joomla installation - if not you will need to make the modifications to the file yourself. You can download a zip file from here containing the three htaccess files that are referred to in the instructions below.
If you have an AceSEF extension for your component you dont NEED to use router.php file unless you dont like the URL rewriting of the extension in comparison with router.php's one.
404 URL/page means that the requested URL/page was not found. The 404 URLs are naturally not wanted by any site admin, they hate them so much so they sometimes can accuse the other party falsely.