Well for what it's worth, I installed it on my Pismo 400 Mhz/640 Ram and it's performing awesome. The finder is a little slower, you can feel the drag when things open mostly because of animation but that can be turned off.
Overall, OS 9 application performance for the two apps I still use is just as good or better. Application launch time is definitely better and it's running Panther beautifully.
Hopefully this gives you an idea. Also, note another person on macnn upgraded his ibook 300 and had a positive review. I don't think you have anything to worry about.