CRT iMacs are really miserable to use, except maybe for the last generation of 500 - 700 MHz slot-loat CRT iMacs. The rest came out in 1998 using 1997 Apple parts. Ugh. Couple that with Mac OS 8 or 9 and it's even worse. Not even a good web browser to use on the dang things (Mac MSIE sucks, and there's no modern Mozilla based browsers for OS 9). Most schools never even put enough RAM in their iMacs.
But I really do like Mac OS X on modern Apple hardware. Version 10.3 really improved things a great deal, but heck, even the original 10.0 was lightyears ahead of Mac OS 9 (totally different architecture, totally new OS). I bought a PowerBook G4 last year to experiment with and now I use it for all of my presentations using Keynote (and sometimes Mac PowerPoint 2004). I'm also starting to use it for my photos and home movies with iPhoto and iMovie+iDVD.
ikickpigeons, was your sister used to Mac OS 9 or Mac OS X? OS X is totally different from OS 9. If she was used to the older OS 9, then Windows XP would be just as easy for her to learn as OS X. Besides, if you do make the upgrade to OS X, you will not want to run your old OS 9 programs... you want to go pure OS 9 or pure OS X. Any mix of the two is a mess, and sometimes unstable.
I recommend that OS 9 users make the leap to a pure Win XP or a pure OS X environment. There's no such thing as a smooth transition from 9 to X (although you can obviously move over all of your data files from AppleWorks, Mac MS Office, iMovie, iTunes, etc etc etc). Running old "Classic" OS 9 apps on Mac OS X is like running 16 bit Windows 3.1 programs on Windows XP.