Holy cow! I'm running iPhoto 4 on an old, stock, 266 MHz Power Macintosh G3 from 1998, and I can hardly believe my eyes. I have close to 6000 photos (most around 1 MB in size), and had pretty much given up on iPhoto 2 because it was so slow. iPhoto 4 absolutely flies by comparison. Scrolling, rotating, selecting, even quitting—everything is at least an order of magnitude faster. I haven't encountered any of the minutes-long inexplicable pauses that so frustrated me with the old version. It's like a whole new program.
For me, iPhoto 4 is thus well worth the price of iLife '04 all by itself, even if it took two hours to import my old photo library.
Incidentally, while the downloaded version of iTunes 4.2 refused to install in my beige G3 (which I presumed was because my 266 MHz processor was below the 400 MHz supported threshold), the iLife CD-ROM—which includes iTunes 4.2, iPhoto 4, and iMovie 4—was perfectly happy to install. Very odd.