Try the usual... First open system profiler, and check the USB section to see if the webcam is listed. If not, then well odds are you're going to have to replace the front bezel on your system. The good news is that your system predates Apple putting the glass panel on the iMac. The bad news is that your system is a right PITA to get apart and tends to require a special tool of sorts.
The other bad news, is that your system is likely now on the vintage list, so unless the system was bought in California, and you still live in California, AASPs won't be able to get parts from Apple. That just leaves scrounging ebay and craigslist and hoping to get lucky.
Honestly, on a system that old, I'd just buy a USB webcam. There's no real point sinking money into repairing that system at 4-5 years out. Once it finally dies, or something gives out that you can't as easily ignore as a webcam, you can move on to a new iMac which will very quickly make you wonder how you ever managed to live with the old one.