The one thing that is overlooked when comparing speed is that OSX does not need a 2ghz chip to run smoothly. you cant really compare the chip speeds since the architecture is so different. I have a tibook with a G4 667. It is blazing quick for what i need it for. (Not games, but it can play Warcraft 3 really good) I used a g3 300 with 10.2.4 this weeekend and it responded quickly to everything.
The G3 is still a good chip, but you should get the G4 instead. much quicker chip. (mainly for guaranteed support for quartz extreme. QE needs 16 megs of video mem to run and i forget where they switched from 8 meg cards) The ibook is great since it is virtually indestructible as it will boot after you run over it with a car and they really do have 3 hours of battery life.
The Ti Books have multihead support and you can hack an ibook to do it fairly easy. It already has the hookup and it is only a software modification.
if you are switching from a pc, it will may seem a little bit slower in internet browsing, but that is changing.
Sorry im rambling..Overall, i would get the 12 inch powerbook since it is a g4 and one hell of a computer, but that is just me.