Yes, the iMac is not in the PB's market, but it is a consumer computer, and is less of a priority compared to the professional line PowerBooks. There will be many people complaining if the iMac gets G5 processor before PowerBooks, and I think Apple is trying to avoid that.
There will most likely be a complete redesign, and Jonathan Ives will have something completely new and revolutionary to wow the world and make us be glad we are Mac users. However, it will not be metal, since Apple has made a clear distinction - professional computers are aluminum and consumer models are white.
The iMac, as previously mentioned, has arguably been the most groundbreaking computer that Apple has made (with the exception of the first Macintosh) even though it is not the top of the line computer. The CRT iMac was a first in that it came in a bright color with a translucent case design, a huge leap from the beige PC's and Macs prior to that time. The LCD iMac was one of the earlier ones to bring a high-quality screen to the consumer market, and its design is famous, even among the general public. Its distinctive form factor is eye-catching and truly shows Apple's spirit of innovation, as a leader of the computer industry. Hopefully, the G5 iMac will be as great and impressive as the G3 and G4 iMacs.