That looks like a good, solid computer although be aware that the flyback/analog board/power supply is a known weakness. It is one of the earlier models of iMac since it has the IRdA port on the front.
As for what they're good for-they make great computers for running the games that were current when they were out. Printing is possible as long as you find the correct drivers. HP printers-in my experience-tend to have pretty good support in OS X, although if you want to stick with OS 8.5/OS 9 you have to be more selective. Since you have USB, there's a decent selection of printers "out there."
For email, you have a couple of options which may or may not work depending on your client. Microsoft Entourage is good in both OS 9 and OS X, although the Office 2001 version is limited. The built-in Mail client in OS X Tiger(10.4) is decent, as is Tenfourbird. Web mail is always an option using Classilla(OS 8.6-9.2.2) or TenFourFox(10.4).
Be aware that they come up a bit short if you want to browse the internet or do anything like that on them, although it is possible. Versions of OS X past 10.3.9 are not officially supported, although 10.4.11 is possible with Xpostfacto and for the most part is a good upgrade from 10.3.
Whatever you do, I suggest maxing the RAM. These take PC-66(or faster) 144-pin laptop SO-DIMMs. Depending on whether it's a Rev. A or Rev. B, the max is either 384mb or 512mb. 384mb would be 1x128mb and 1x256mb, while 512mb would be 2x256. In order to put this much RAM in, you have to remove the processor card(not as scary as it sounds) to install RAM in the "bottom" slot on the underside of the processor card.