Hi,
I'm using Logic in OSX. Using a iMacG4 at the moment for it until my new G4 Powermac will arrive.
If you only want to use about 8 audio tracks (mono?) it should be no problem. A firewiredrive is fast enough. And if you don't want to use much effects, the G3 processor should be also ok. But keep in mind that logic is optimized for the G4 proz., it's way faster, at least if you use effects/softsynths.
Logic X vs. OS9.... There are some differences. OSX use "Core audio", so no VST/VSTi will work. The disk preformance is a bit better under OSX, but you can use more internal Logic effects on OS9 than under OSX. But remember, it's the first version of Logic for OSX, so there is room to optimize it.
Hope this helps a bit.
Cheers
beefpile