Steve Jobs chose them for 2+ years down the line. He never said anything about Intel's offerings besting the G5 any sooner than that.
The general assumption has been that the Power Mac will be the last to make the move. The G5 is not currently lacking (the G4 is), so there's really no need to replace it quickly. Also, the Power Macs are professional systems, and professionals can't afford to be guinea pigs. It will take time for pro apps to be ported to Intel Macs, and until that happens, the PPC machines will be MUCH faster. This doesn't matter much to average consumers, but it makes all the difference in the world for most people who'd be in the market for a Power Mac.
Of course, this is all just speculation. Apple has never said anything definitive. All they said is that the transition should start in mid-2006 at the latest, and end in mid-2007 at the latest.