You could try lowering your screen resoloution, and lowering the colour depth form 32 to 16 Bit, more Ram "might" help and you "may" be able to get a CPU upgrade (to G4) althoug I think these are only avaible for the first Rev A/B/C iMac's.
Basiclay your Vid cards not powerfull/tech enough and is running out of Vram, (game really nedds 32MB Vram to run okay, at a minimum really).
Sorry to break the news; iMacs are great little machines, but when it come to games, Apple bottom luv's you with what you get and the non expandability.:o
