Yes, your G5 is powerful enough to edit HD video, although I would recommend a miniDV HD camcorder for better compatibility. If you go the newer AVCHD camcorder route you won't get built-in compatibility with AVCHD on your G5 using Apple's software. There is, however, a third-party utility that converts AVCHD to friendlier formats called
Voltaic HD, and it's G5 compatible. But if you go that route beware that you'll have to waste some time converting new footage from AVCHD to a QuickTime native format, and I don't know what kind of speed to expect from that software.