I never did come up with a cause for the failure of my wife’s iBook. We bought a new aluminum MacBook. Very, very, very nice. (Yes: Three Verys!)
We had all the data from the old machine backed up (both to the server in the house and to Amazon’s S3 via Jungledisk), but in the interests of laziness I ended up popping the hard drive out of the old computer (a fun process!) and then used an IDE to USB cable and Apple’s built-in data migration stuff to set the new computer up. Took many many hours anyway since there was about 35GB of data that needed to be moved, but at least I didn’t have to really babysit things.
Anyway, when the process was done, my wife was up and running pretty much without any issues on her nice new computer.
I still have the old computer. A new motherboard, which I’m sure would resolve the issue, is something like $250. Not sure if there’s any really good reason to go that route. I’m thinking that maybe that money might be better spent on one of those new Mac mini’s that are rumored to be coming. And that’s assuming we need to have three Macs in the house at all. But I keep thinking I want to do more with GarageBand. Not a great reason. My guess is that we just become a two-Mac family.