You would see a significant increase in speed, particularly in web browsing. Safari 2.0 (included in Tiger) has a much faster and more robust webcore. Additionally, Tiger is zippier in general. I run it on a 700 MHz iMac in addition to my PowerBook and it's working out well. If I were you I would upgrade.
No problem, and keep in mind that tiger comes on a DVD. Assuming that your iMac's optical drive can't read DVD's, you have a few options. Apple will exchange the DVD for standard CD-ROMs for an extra $10 if you fill out this form. Another option, which I opted for when I upgraded my 700 MHz iMac, is to use another Mac, either yours or a friend's, which has an optical drive capable of reading DVD's and to install the upgrade over a firewire connection by mounting your iMac as a disk on their computer. Let me know if you need instructions on how to do that.
There are other possibilities as well if you don't have immediate access to another Mac, including copying an image of the Tiger CD to an iPod or other removable media and connecting that media to the iMac.