Having owned several iMacs in the past years I can say that the iMac in question is still quite useful today... as long as you up the RAM to at least 512MB and throw in Tiger. Granted, it won't play new games and can be dog slow with bigger applications but totally usable. It will make a fantastic machine for web and email expecially for the price you're getting it. But it's useless with the amount of RAM it has now.
http://www.apple.com/downloads/ and versiontracker.com are good sites to get freeware stuff.
Joshua.
EDIT: With enough RAM, Tiger (10.4) actually runs better than Panther (10.3) even on a slower Mac. Another reason to get Tiger is that many, if not most new applications require Tiger.
EDIT2: "Since the Mac is supposed to be a bit less virus and spyware prone than Windows, I thought it would be a safer bet for them."
Mac OS X is *completely* virus and spyware free
EDIT3: Most of what I've said here appears to ahve been said already. I'm just re-inforcing the facts
