Worth it?: iBook G3 800Mhz to New iBook G4 1.2Ghz

I would say so

My sister has an iBook G4 800 Mhz and I have one of the new iBook G4 1.2 GHz, and I can tell you that mine is significantly faster. Mine also has more RAM, so I couldn't tell you how much of a factor that is. However, I would think a 50% boost in processing speed as well as the jump from a G3 to a G4 would easily make the upgrade worth the money. I believe Panther is really tuned to take advantage of the G4's vector unit, as well as the iLife apps (iTunes, iPhoto, etc.). So you would at the very least see a performance boost in those applications even if you bought a G4 model rated at the same clock frequency as your G3. Plus you would have a faster bus, a faster CD burner, USB 2.0, and built-in Airport Extreme.

Upgrade to the ibook 1.2Ghz G4. It will be at least 50% faster in almost every possible scenario and in some cases may easily be twice as fast as the ibook G3 800. Your friend could spend well over $100 to upgrade the RAM and OS and he or she might be ok but a year from now they will probably be needing or wanting more power. A year from now that ibook G3 would probably be have a resale value of $200 less than what your friend could get for it now if ibook is sold today rather than a year from now. So in reality your friend would be spending about $300+ to keep ibook G3 around for another year while he or she could sell now and get about $600-$700 for it today depending on condition and specs. So that means a new ibook G4 12" would only cost about $200 more than trying to keep the ibook G3 around.

Seeing as you can upgrade, do it!
The RAM would help, but a G4 would help more.