Overall CPU temperature isn't always an indication of proper heat conduction. If heat sink compound starts to dry up and cracks develop, the overall temperature can still be inside safe ranges but tiny areas of the CPU can heat up more than surrounding areas which can cause all sorts of issues.

The most common problems I've seen with G4s come from when the CPU card warps a little and one corner or edge of the CPU no longer makes direct contact. The CPU itself doesn't overheat, but one part heats up more than the other, more quickly than the other, and the expansion and contraction over time can eventually damage the CPU permanently. This is why it's always good to reapply good paste to any older machine which hasn't had it replaced regardless of what the sensors say.