Hm, to me, that might actually make a difference as to which machine would suit you better... What version of the software would you be running? CS2? CS3?
I really disagree. I started off w/ a 12" PB which many might consider better than an iBook, but I consciously chose to "downgrade" to the iBook and it suited my needs much more and I liked it as a machine more (better wifi reception, ran cooler, much much better battery life, etc.). That said, I have since sold the iBook and am typing on a MacBook and I would never go back to a G4 laptop. Especially not to run the Adobe apps. PS ran quite slowly on my 1.33GHz PowerBook and it runs better on my iMac G5... and my MB blows the iMac away on everything else, so I can only imagine that if I ran PS on my MB, it would be amazing.
I'd save up and get a refurbished MB. It is not a "lesser" machine at all.