Since you're leaving out many details, then this is only based on the little bit of information you've given. Yes, it's entirely possible that the power supply is dead. What usually happens, though, is that the heat sink grease between the PowerPC 601 and the heat sink dries up and the processor gets cooled unevenly, and this leads to crashing and lockups (particularly when running the CPU at 100% like when you're running Toast).
When you say the machine doesn't turn on, do you mean that when you push the power button absolutely NOTHING happens?