I would stick with the Tiger (10.3) installer as the 10.4 would be a little much for the slow G3 processor.
As you have a "sister" machine to play with, I would suggest the following.
Pull the RAM from the running machine and put it in the Non-running machine and try again. From what you have said, I do not think that would be a problem for you.
OS 9, and below, were fairly lenient with RAM specs and most RAM that fitted into the machine, would work. OS X is a little more picky about RAM standards.
If that fails, reinstall OS 9.2.2 and take another look at the firmware version.
The Graphics card cannot be changed out, it is integral, but it would be possible to change the processor for another of the same type and speed.
Good Luck
P
I have an iMac G3 DVD/400 Graphite, 512 MB RAM, which runs OS 9.2.2 (which it came with) perfectly but will not install OS X Panther or Tiger (Family Pack) without problems. I bought this for a friend who's fed up with Windows and want to sort it out !! It took several goes to get a full install beyond the 'There were problems installing....Please try again' warning. Firmware is 4.1.9f but when it runs the Tiger install DVD, some very weird 'remaining time' figures (eg, 16128 minutes) are displayed after about 10 minutes. Once installed, the OS X command windows become TRANSPARENT over the desktop screen design, with very strange font distortion - some are very chunky' in places and very dark black. I changed the DVD-ROM drive in case this was a problem but it made no difference, so I changed this back again. I ran the Firmware again after wiping the HD but a warning said it didn't need it.
The DVD disc loads and runs Tiger perfectly well on a sister Graphite 400 DVD - everything displays as should.
Maybe the previous owner didn't sort out the firmware before installing a version of OS X and went then too far but I can't be sure as couldn't find OS X previously installed when I bought the iMac.
One other thing I tried - I put in another hard drive which had a friend's Tiger installed but the same transparent command windows showed up, so I assume it's the computer that is at fault. Tried Panther (perfectly good CD's) but this won't get beyond first install CD.
Can anyone please suggest what might be the problem, perhaps a graphics card ??? CPU ??? Is there an issue with Family Pack Tiger that I don't know about ?
Thanks.

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