In a recent OS version (8.something or other, don't recall exactly) Apple moved your monitor resolution settings out of the pram and into the preferences folder. It is now normal for recent Macs to begin at 640 x 480, and switch during startup to your preferred resolution.
That explains the extra-large graphics during the beginning of the boot sequence. Also, the momentary black screens while switching resolutions. Your boot description is accurate for my G4 with 9.0.4 so this is now normal.
I have yet to use the update coupons, and would like to know the answer myself. It sounds like either free stuff, or (more likely) discounts on later OS versions. I would be happy with either.
