Actually, I've made 10.3 run smoothly with 160MB of ram. To state that 256 isn't enough is just preposterous. The claim is that he wants, at least at first, to use internet and word processing. 256MB can handle that perfectly smoothly. Once you start doing other stuff on there, as we all know you will, then invest in a 512 stick. 768MB of ram is most certainly good enough to run many many windows, and exposé between them fairly rapidly. I wouldn't go cracking open Final Cut Pro, but any applications that are not so processor heavy run well.
The reason a G5 runs rather poorly using 256Mb of ram is that one seldom uses a G5 for processor light applications, or when one does, one tends to run many of them. 256MB is a bottleneck for a machine like a G5, because the processor is capable of performing tasks that would require far more memory. Not only is the iBook in question a G4, but there are power issues to consider. To maintain battery life, most applications being run will not be very intensive. We have a 1.6GHz G5 open at work, used mostly for storing disk images. We also demo a few pieces of software on it occasionally. We've not upgraded the stock 256MB, and it runs fine for what we need from it. It's on the floor, so it doesn't get worked very much. People fiddle a bit, and we use a few pieces of software, but not very much. This is not typical G5 use. It is however, average computer use.