Like nagromme implies, it's going to depend on how much RAM you have.
In my experience, if you're dealing with less than 256MB, then you probably want to stop at 10.2--it just handles limited RAM better than 10.3 (or, I assume, Tiger), and it's MUCH faster than 10.1. 10.3 will run better than 10.2, but only with sufficient RAM (probably 384MB or more).
Tiger probably likes RAM too (how much, I haven't seen reports yet), but I don't know how it's going to feel speed-wise on a G3, seen, though I may install a copy on an old iMac just to see. Definitely faster than 10.3 on a G5, but that doesn't necessarily translate.