Personally I'd do minimal Linux+BasiliskII if that's your plan. Fusion is inferior to BasiliskII by any measure I can possibly think of. (Unless "runs on DOS" is your criteria. But if you want DOS install dosemu. It'll run positively great on that hardware.)
Heck, even Sheepshaver might almost be "usable". If your standards are really low. (Extrapolating from my 2 Ghz Core Duo, which Speedometer 4 thinks is 10 times as fast as a PowerMac 6100, well... if a Core Duo is 10 times as fast as a 300Mhz PII it might be close to a tie.)