Does it make any difference if you option-boot? Or select in startup disk? Or hit the install button from the Leopard installer app on the DVD?
If you have a firewire drive, you can make a disk image of the DVD and restore it to the FW drive. Then boot from FW and see what happens.
You could also put the DVD in your MacBook, boot that into FW mode, then hook it to the G5 and see if you can boot from it that way.
So many ways to skin this particular cat.......