You'll definitely see a good improvement in encoding DVDs when using a dual processor (or dual core) PowerMac G5 instead of a single processor PowerBook G4! The intel PowerMacs won't come out for quite a while, and you probably won't want the very first iteration. So my advice is to buy now, replace later (late 2007, early 2008 or something like that). I dunno about the RAM, but I guess more of the slower version gives you better performance than less of the quicker version, i.e. you need as much RAM as you can afford.
Mac user since 1987. Running Mac OS X 10.8 Mountain Lion on a MacBook Air 11" & an iMac 27" and whatever's newest for my iPhone 4s, iPad 3 and AppleTV 2.
Apple Certified System Administrator 10.6, Apple Sales Professional 2008-2011, Apple Certified Mac Technician.