And, on further investigation, there appeared to be no floppy driver in the imac's firmware, it's all in the Mac OS rom.

I found there is a 8.1 boot floppy, it is a disk tools one supplied with the 8.1 update on apples website, boots up the iMac fine

However it only boots if there is a hdd connected with Mac OS rom 1.1.5 (or earlier)

And further more, I got the firmware downgraded to work tried it annother couple of times, and eventually I got the progress bar and a message saying update successfull, but no change, won't boot the FDD without a bootable hdd connected and no FDD support under rom 1.4