I have a early 2006 iMac Core Duo 2.0 GHz with 2 gig RAM and have been working with some AVCHD footage (recorded with an older camera so higher than 17 Mbps) and the footage on an external hard Firewire 400 HDD and it's been fine for editing. Higher bit rate footage may slow you down a bit, and using a slow HDD (USB and/or a lower than 7200 RPM drive) will certainly slow it down a bit.
One thing for getting the best with these older machines- when you edit, do it after a restart and don't have anything else running- no itunes, no browser, no mail- nothing. The AVCHD footage will take slightly longer to transcode but you can set it up overnight to do that (I found it will take maybe twice as along as the running time of the footage- maybe longer but not excessive).
I used 2 different Sony camcorders (i think SR5 and SR10) and had no issues (tip: don't record standard definition MPEG and AVCHD on the same camcorder- if you do, the HD stuff won't show up). I hear Canon's work fine with Mac's too.