Once you have the drive(s) installed, you will need to initialize them. You do this by booting from the OS X installation disks or from the Restore disks that came with the machine.
Once booted, ignore the installer and take a look at the menu bar at the top. Hiding in one of those choices will be Tools or Disk Utility or the like.
You are looking for Disk Utility. Launch it, select a drive from the left hand pane, click on the Partition tab, choose 1 partition, journaled, HFS+, extended and click the Initialize button.
Very shortly the drive icon will appear on the desktop.
Repeat for all other new drives.
Quit and go back to the installer and install OS X on whichever drive you want. It does not matter which one, you can boot from any of them as long as there is a valid system on it.
iTunes, iPhoto, iMovie & iDVD will not be installed but Safari will. If you use the Restore disks, the machine will be as if you had just opened a brand new machine, including all the applications that were on it when it left Apple. I can't remember if the iLife suite was included with the PM series though. If it was, and the OS, on the Restore disk, is lower than 10.4, it might still be worth installing the lower OS and updating it, just to get the iLife programs. Of course, you may already have the purchased version of iLife.
I just recently got a Power Mac G5 (June 2004 model) from a family member, but I want to replace the hard drive with a new one. I understand I can use just about any SATA drive I'm looking to replace the old one with about 1TB of space, but how to I initialize it once I physically install it, and will I lose the basic programs, such as safari, iLife, iPhoto, etc? I know I'll lose the loaded data such as pics and music. I'm still a bit of a novice when it comes to the macs.