I found this on Mac Fixit today and just wanted to let other people that don't know about mac fixit to read this.
Warning -- keep iPod and other magnetic devices away from lower-right portion of the iMac The iMac G5 rev C (iSight) contains a magnet on the lower-right corner of the machine (below the slot-load SuperDrive) that is used to secure the remote in place when not in use. Be sure to keep iPods and any other storage devices that use magnetic media away from this area to avoid potential data damage.