Hey insan,
I just recently switched myself and went through the ibook vs. powerbook question so I can tell you what I went through. I ended up buying a 14" ibook for a few reasons. The biggest being the cost (since I've only just graduated from being a poor student to becoming a poor teacher
).
Anyway, I did want the powerbook but since they're both G4's, the Ibook gives the Powerbook a pretty good run for its money. The powerbook does have some extra pluses though. Here are a few of the things the Powerbook has that the Ibook lacks:
1. A way better graphics card. It lets you plug in another monitor and use it as a seperate "work space". Think of it as a giant monitor split up in two. Really nice if you do video editing. But it might not interest you too much. The Ibook only supports another monitor that shows you what's already on your screen.
2. An audio input! Man, it sure was cheap of Apple not to include this on the Ibook. You'll have to buy an external device that'll run you around $100. But since you'll be transferring your VHS tapes you'll need something to get your video inputs anyway and the audio ins should be included in that.
3. A video ouput! Another cheap move by Apple on the Ibook. You'll have to buy special cables that'll run you around $20-30. I don't know if the Powerbooks have RCA outs or if the cable is included, but they'll be set to go.
Aside from that, I'm really happy with my Ibook. The Powerbook does have a nicer case and that widescreen though and that scrolling thing on the touchpad but it was a debate whether it was worth the extra cash. Oh, and the Powerbooks have better screen resolutions on the 15"+ models.
I didn't get the DVD burner because I was waiting for the dual-layer burners (the 8+ Gig burners--twice than regular). And I'd suggest you think about whether to get it installed on yours. Check the specs. I'm not sure if they have dual-layer burners on their laptops yet. And you can buy an external for cheaper that burns at 16x as opposed to the 8x you'd get with Apple.
As for the word processing software, I opened up the program that came with the OS once and didn't bother after that. I'm sure it works fine for simple papers but I'm used to WordPerfect and Microsoft's ripoff Word and I need all the extra features you get with those. I had an IT friend install Word for me and I'm fairly happy.
So I hope that's a bit of help for you. I say, if you can afford it, go for the Powerbook. But if money's a concern, the Ibook is a good choice. They're a little behind on upgrading the Powerbook anyway. It really should be a G5 by now and it probably will be later this year. And it'll cost the same as what you're paying now. So pound for pound, at the moment, it's an Ibook that's the better value. Not unless you need all those things listed above. Oh, and definitely wait for the new Ibooks to come out. Check the buyers guide; it's way overdue. Then decide.