Can iPartition work on the same physical disk from which the system has booted?
No. Due to the way that the IOKit works, it is not possible to manipulate the boot disk to the extent that iPartition would need to. Like most other Mac OS utility software, you will require another Macso that you can use FireWire target-disk modeor another boot disk of some description.
It's called System Rescue CD, and it comes with a lot of tools for repartitioning. I've used the x86 version and there's a program called QtParted that allows you to resize partitions non-destructively, like Partition Magic. This has worked for me on many occasions (unless dealing with NTFS). I haven't ever used it on PowerPC machines though but I'm sure it will work fine. Just be sure to backup your data before doing anything.