My guess (very much a guess) is this...
There will be something like ... what's it called? Xpostfacto or something like that? There will be a tool that will allow you to install Leopard to that computer even though it doesn't meet requirements. It will run properly.
However, you won't have enough memory. My personal experience with a probably loosely comparable computer (iBook G4 / 800MHz) is that I was very impressed generally with Panther on 640MB and felt very comfortable. I never felt like I needed more memory. When I went to Tiger, I had to disable Dashboard and free up a lot of HD space to make it happy, until I went to 1.125 GB, at which point my iBook runs excellently on Tiger. I don't know how Leopard will do on that much memory, but I'm fairly certain that you'll have to turn off a number of features (e.g. Dashboard, perhaps Spotlight, Spaces, etc) to get Leopard to run pleasantly on that computer without more memory.