I purchased a DP2.0 PowerMac last Monday, and while it is very fast, I have no real need for it currently. I could get by doing my music work using a PowerBook or iMac, but the good thing is that if I need analog 7.1 output I can get a nice internal solution, or if I needed more storage there's always that internal drive slot available. Since my budget was about $2000 (graduation gift), I decided to get the best computer for my money and skimp on the RAM and display. I ended up pulling a gb out of my PC to put in my PowerMac so that should tide me over for now. But I'm still stuck with a 17" CRT. One part of me wishes I would have gone with the iMac due to the built-in 20" display but another part of me appreciates the power and expandability of the PowerMac.
ANYWAY... if I were your brother...
What year is he in college? if he only has two more years left as a graphic student then I would get the iMac. If he's a freshman (like me) then he may want something that'll last four years with no problems. In that case, get the PowerMac. Either machine you buy I'd recommend 2gb of RAM. Then you won't have to worry about too many apps open, and closing them... etc. He'll work a lot faster.
And I wouldn't worry about the Intel PowerMacs coming out in ~2 years. When Adobe releases Intel versions of the Creative Suite, they'll have to simultaneously release a PowerPC as well because so many users will still be using PowerPC. So I suspect Adobe will support PPC for at least another one/two generations of Photoshop, depending on how well Intel Macs take off.
If he needs the computer now, buy it now. I've found that when dealing with the computer industry, it's best to get what you need when you need it and live with no regrets. When it comes time to get the next new machine, save some money and/or sell your current one. Remember, the more expensive the computer is, generally the longer it will last AND the higher the resale value will be. The computer won't suddenly become obsolete when new Intel Macs are out, and they'll probably float around for ~5 more years after Intel Macs are released. By that time, your brother will be desperate for a new machine. It's hard to enjoy a computer purchase when you keep worrying about what you COULD HAVE gotten instead of what you actually got.
Hope this helps.