Well I AM getting it for free, so I don't want to pay $300 for a G4 that's going to be outdated soon anyway.
And I was thinking about those CPU upgrades, but I saw that I won't be able to run tiger past 10.4.6 or .9 It's only a $129 upgrade.
Does anyone know about GPU's for these? I doubt the stock one will be very good if its only 16mb.. Also, does it have the proprietary video out? or standard VGA. My friend is including the CRT

monitor that came with it.
I beleive the B&W G3s do have the proprietary VGA, yeah.
The highest you can run right now I believe is 10.4.9, because CPUDirector doesn't support 10.4.10 or 10.4.11 yet (assuming it ever will). That's what I'm running on my Beige G3.
A G3/1000 upgrade is a good idea, as mentioned, and it's cheap (there was a time when a G3/300 would have cost you over $1000!).
As for the GPU, it wouldn't be a bad idea to upgrade to a Radeon 7000; 32 MB VRAM (64 MB if you buy a flashed PC version), and you can enable Quartz Extreme on it via the software PCI Extreme. That's what I did, except I use an original Radeon Mac Edition, a faster card. You could also get a Radeon 9000 128 MB DDR, and probably ebay it for about $60 total including S&H.
As for flash, yes, it's much slower on PCI-based Macs; I believe it's because the older video cards are very poor at handling flash overlays (that's what I've read). Flash 10 (Beta right now) does speed things up a bit, especially in places like eBay where it's flash-based content but not flash videos.
I'm still happily running my Beige G3 w/a G4/500 upgrade and 768 MB RAM (maxed out; an insane amount of RAM 10 years ago that would have cost me over $2000 at the time, and is now next to nothing). Upgrading to 1 GB is a good idea.
You can put in any ATA PC HDD, though you'd get the best performance if you installed an ATA PCI card (or an SATA PCI card) and a new 320 GB or larger drive; a 500 GB SATA drive can be had for under $100, and an SATA PCI card, I believe, can be had for a similar price. A new hard drive can speed up your Mac as much as a new processor can (in the ways that it speeds things up).
DVD-RWs are very cheap, $30-40, if you're interested.
And I believe you'd be happiest in Tiger, Panther really is a little long in the tooth now, and Tiger is even a bit snappier in some ways, not to mention it supports thousands of pieces of software that Panther no longer does.