I had good results with OS 8.1 on my G3 minitower, better with OS 8.5, fantastic with OS 8.6.
Your mileage may vary, but get thee to a MacOS 8.5 CD and then download the free MacOS 8.6 update and install both on your iMac...
see
www.dealmac.com or
www.pricepulse.com for best price on MacOS 8.5
for MacOS 8.6 free from Apple:
http://asu.info.apple.com/swupdates....6?OpenDocument
and if I were you I'd backup my HD and reinitialise it and then install OS 8.5 and then 8.6 right after... I think you will like the results.
FYI, 8.5 and 8.6 do represent some fairly major changes but not much change in the GUI (graphic user interface; what you 'see' when you interact with MacOS and applications) most particularly a new nanokernel (deep guts of OS) and better VirtualMemory, other improvements to be sure but these come immediately to mind.
[This message has been edited by wlonh (edited 12-06-1999).]