If upgradability isn't an issue for you, get the iMac. It still allows the option of ext. HDs, which is likely all that would need to be updated after you put some ram in it. It is a great computer and good value when you consider all that is packed into it.
We use both- g5 imac for photo and powermac for video. If you can afford the power mac, the differences are very noticeable and worth the price. If you want to get away with spending the least, the imac is very capable. BTW, if you decide to go the powermac route, we have a dual 2.0 for sale. Macdoc has great pricing on new and refurbished g5 imacs if you go that route.
I just got the latest 20" iMac, and I was in the same situation a few weeks ago, debating what would be better for me. I use a dual 2 Power Mac G5 with 4 GB of RAM at work, and it's great that I can have 10-20 illustrator files going, and still be able to work in Photoshop with a few files open, and with tons of layers. Probably won't be able to that comfortably on the iMac, but I don't work as hard at home.
A new G5 will definitely last you a longer time, but how I see it with the the move to Intel chips, by the time the switch is stable, it will be time to upgrade back to a PowerMac. I'm currently using the 20" iMac with 1.5 GB of Ram, and did the Monitor Span hack onto my older 19" CRT, and it's great having all this real estate. I have Aperture and Photoshop open together working all the time, and seems to be doing fine, I don't have as many files open as I normally do at work, but I'm not having issues about performance. So it's good for me.
But here's what I recommend. If you have another job that you go to do design work get an iMac, but if freelancing is your only source of income, get the PowerMac. The iMac is a great machine, but it's no PowerMac.
If you're not doing intensive things then an iMac G5 2.1Ghz will perform as well as a PowerMac G5 DualCore 2.0Ghz, and price vs. performance wise the iMac is a great value. Once you start getting into heavy multitasking, renderring, etc., the ability to upgrade the PM G5 will absolutely blow the iMac away.
Home: 2006.5 iMac 20"
Me: 2010 MacBook Pro 13", iPad Mini Wifi 32GB Black, iPhone 4 16GB Black
Wife: 2011 MacBook Air 11.6", iPhone 4 16GB White
Are you backed up??? If so, why? Psyllium Fibre is not free but will do wonders!
the Intel chip is one of the main reason's that I was wondering, especially for upgradability. I do some pretty intense stuff.. with the usual design apps (Flash, PShop, I.D, Illus. etc). I'm also on a limited budget, so I'd like to get the best I can now.. because it will be at least a year before I can upgrade again....
I bought my PMac over 4 years ago and had the same decision to make. All in one iMac for $2000 or PMac + Monitor for about $3000. Looking back I am really glad I got the PMac even though I don't do a lot of intensive work. I've made some money back doing video work and bought FCStudio in the spring. Although performance has of course not been stellar, this would have not been possible in a 4 year old iMac. That said the new iMacs do rock and I will be facing the same decision in the near future.
2.66 x 4 Intel Mac Pro, 4G RAM, 160G System 500G Scratch, Media, 320G Photo Capture, 320G Video Capture. 733 Quicksilver 1G Ram 120G system 60G backup 160G and 200G capture.