Can I use iMac G5 PowerPC for iOS app development? If not, why?
Depends how you want to develop, if you want to use the official tools and SDK, then you are out of luck:
What are the requirements for developing with the iOS SDK and Xcode?
To develop with the iOS SDK and Xcode, you must have an Intel-based Mac running Mac OS X Snow Leopard or later and you must be registered as an Apple Developer.
Officially, you can't develop iOS apps on a PowerPC machine. However, someone got Xcode working up to, but not including iPhone SDK 3.0. The details are available here.