Finally, a topic that I have authority to speak on!
I have a G3 iBook 800mhz with 384mb RAM that I use for extraneous tasks at work- internet, mail, some file handling, color-management apps, and(gasp!) some file manipulation via Photoshop.
At my suggestion, a few months ago, we purchased a G4 iBook 800mhz for the same purpose, but I had the sense to put 640mb RAM in it.
Both run Panther (10.3.3), and though I love my little iBook G3, the G4 has many advantages:
-the G4 is seemingly much more stable in Panther, especially with multiple apps running...but that may be the extra RAM talking.
-though the G3 aesthetically has cleaner metallic lines, the G4's keyboard is easier on your fingers and causes fewer typos. It makes it feel less like a toy than the G3.
-the G4 has longer battery life and a faster recharge rate.
-the G4 has a metal exterior to the headphone jack. My G3's similar plastic jack was shattered months ago, after my warranty was up.
-the G4 slot-loading cd/DVD drive makes me much more comfortable when I'm switching discs on the go in a car or on a plane.
And as a total aside, in 14 months with my G3, I've had to repair the logic board, 2 power supplies(died, not lost), and the cd tray. Nowadays, it doesn't like to be powered down unless you ask it very nicely...