Well, you can't get a more powerful processor unless you buy a different machine. The 800 MHz G4 should do fine for light video editing work where time isn't a major concern. As far as the RAM - get as much as you can afford. Put 1 GB in if you can afford it. The only issue is that only one of the iMac's RAM slots is user-accessible, so I'd say open Apple System Profiler (Apple Menu -> About This Mac -> More Info...) and look at the RAM profile to see how much RAM is in each slot. You should add at least 512 MB to what you currently have.
Anyway, there will either be 256 MB in the hidden slot and an empty user slot, or there will be 128 MB in each one. Just replace whatever is in the user slot with a 512 MB.