The quad-core Mac Mini is now faster than the high-end (eight-core 3.2ghz) early 2008 Mac Pro for raw CPU speed for nearly every task you can throw at it, and that's before you take into account much faster RAM, USB 3 peripherals and so-on.
I'm not sure if I'd want to run a Mac Mini under any kind of heavy prolonged load, but for running image filters in Photoshop etc. I think it's now more than powerful enough to completely out-pace a Mac Pro 1,1.
The main difference between the two is in GPU performance, as the Mac Pro 1,1 can still take some pretty nice discrete GPUs. But then whenever the Mac Mini gets updated to Haswell it's going to get a pretty good GPU boost that ought to suit a lot of people's needs. I'm not sure photoshop makes full use of GPUs for processing so you probably don't need to worry about that.
So yeah; a current quad-core Mac Mini ought to more than meet your processing needs now. The main issues are packing it with RAM (but 16gb is probably more than enough) and getting enough storage space; but a 1tb Fusion Drive may suit you just fine, or any large external drive. Plus all that is in a much smaller, quieter package with much lower energy requirements (just clean out the dust every now and then).
The main reason to stick with the Mac Pro would be if you really hate waste since sticking with what you have costs nothing, except in power consumption, or if you need to do a lot of long-running jobs (huge batch jobs may count here) where better cooling, and greater reliability may play a factor.