Imac too old???

I have an Apple Imac G3/600 with Leopard and wireless broadband.....I wonder with external HD it would serve as music server. I have latest Itunes on machine and was thinking of ripping cd's and then transfer to ipod. My question is whether the technology is now too old..can I use to transfer digital files to external drive & then ipod?? (Santa to deliver I think!) Also would download internet radio tracks as well. I also have HP laptop less than a year old with great processor speed and hard disk room but seems that vista is harder to use... I use Dared MP-5 tube amp/dac with itunes and this old imac and internet radio and assume it would be part of a music server system with an external HD but I'm not sure how to go about this...can someone simplify this for me??? thanks in advance