Actually, software overclocking is possible. The new 700 MHz iBooks use software to determine the clock speed of the processor. It has been documented on the web many times that you can use a simple utility to change those settings on a new iBook and overclock the processor to 850 MHz, and maybe even more, although that would probably render the iBook unstable.
Of course, Apple would probably never in its right mind prominently include this feature in their operating system, if at all, but it actually is possible to overclock via software, given the right hardware.