I had a problem with dropped frames on the timeline FCP 5.0.3 Power Mac G5 dual 2.3 ghz and 1.5 GB RAM.
This G5 is new. After 9 weeks and meeting many technicians at Apple. I installed a Seagate hard drive, did a fresh
install of Tiger 10.4 and FCP 5.0.3 and copied the the 50 GB project folder to this drive. It runs great, no problems..
Are you running your project on a Maxtor internal drive that came with the machine by chance ?