My iMac G3 has similar specs, and I've found that the best thing you can do is get a new hard drive, max out the RAM, kill Spotlight and Dashboard, and hope for the best.

My iMac Specs:

500MHz G3 Processor

512MB of RAM

120GB Seagate or Western Digital Hard Drive (MUCH faster than the original 20GB)

32MB Built-in Graphics

OS X 10.4.11 "Tiger"

OS 9.2.2