The apps can be recompiled without sacrificing compatibility with older versions. The 10.4 Universal SDK can be used to write 64-bit apps with XCode 2.4 (yay). However, the app's 64-bit payload will only run on Leopard where the frameworks have 64-bit versions.
Although hate to break it to you, the kernel is still 32-bit so that it remains compatible with drivers, which I think is a good choice in the short-term, before breaking every non-Apple driver (again). On the plus side, for the G5, the speed difference between 32-bit and 64-bit isn't really anything to get excited about (actually, it seems in quite a few cases to be slower). 64-bit on Intel is only exciting because it increases the numbers of registers on the chip, so you /do/ get a speed boost from 64-bit, despite the extra overhead of the larger integers.