G5 > G4.
However, for general usage, a G4 dual 1.25 will be noticeably snappier than a single G5 1.6, because Apple has optimized its OS for dual pretty well. Also, compensating to the G4's bad bus speed is the fact that it has 2 MB L2 cache. For certain programs a G5 1.6 would be faster for sure, but I think I'd prefer the G4 1.25 for general OS speed. However, neither are particularly fast...
Personally, in your shoes I'd just wait. Apple will be announcing new machines in 4 weeks at the Worldwide Developers Conference (WWDC, June 28). It's widely expected that the new low end G5 will be in the range of a single or dual G5 2.0.
Also, unlike on the PC side, GPU speed is becoming very important on Macs for video editing believe or not. Apple recently introduced the program
Motion, which eats 3D graphics power for breakfast. See video
here. It's also widely expected that Apple will release machines with the X800 Pro or XT at WWDC.
And even if you don't get an updated G5 970FX machine with X800, once the WWDC announcements come, the overstock old models will drop in price.
Oh, and BTW, it's likely that the new iMac G5 will appear at WWDC too, probably at around 1.8 GHz.