Hey! I've found that the GPU itself coming loose and needing a reball (or heat gun or teacup lights?) to reflow the BGA underneath the chip is more of a G3 problem. I haven't seen many, or any of the G4's with the GPU problem. Hopefully that reset that you did did the trick. However, if it's hardware, it seems to usually be a different chip on the G4's that has an unsoldered pin. What I had happen on my G4 14'' 1.33ghz was this problem, and, like the G3 GPU problem that worked when I held down on the chip when I would hold down towards the "power pins" end of this chip the computer would work, when I didn't sometimes it would work for a minute and give the flashing colors and eventually a grey screen, or wouldn't boot at all and the fan would spin. Here are the links:
What sounds more like this problem, the G4 Vreg chip problem (affects video like mentioned above):
http://www.coreyarnold.org/iBook/
http://macintoshhowto.com/hardware/how-do-i-get-my-broken-g4-iBook-fixed.html
http://www.pcxmedics.com/blog/diy/iBook-g3g4-motherboard-gpu-vreg-chip-solder-joint-repair/ (don't let the title fool you, this is for a g4, not a g3 at all)
And for completeness's sake, the G3 GPU problem:
http://forums.macnn.com/66/iBook-and-MacBook/210232/diy-iBook-dual-usb-logic/
http://www.joshoakhurst.com/2006/06/23/best-ghetto-apple-hack-ever-iBook-logic-board-fix/
http://geektechnique.org/projectlab/726/diy-obsolete-iBook-logic-board-repair
http://blog.mic-b.com/?p=199