Yesterday I picked up a Samsung 216BW 21.6" display with 1680*1050 resolution. Although I'm still awaiting arrival of the Radeon 9200 (64MB) card, I thought I'd try to hook up the monitor to the stock Rage 128 (16MB) card to see what happens. I powered up the B&W G3, and was pleasantly surprised to see the Apple logo appear followed by the startup screen. I logged into my account, and found that the Rage 128 was actually displaying in widescreen mode, albeit at some non-native resolution. Naturally, the next step was to pull down the displays menu and check the other resolution options. The menu read as follows:
SyncMaster
1280 x 1024, 60 Hz, Millions
1680 x 1050, 60 Hz, Millions
1680 x 1050, 60 Hz, Millions
I chose the last item (can't say why this item was listed twice), held my breath, and an instant later was blown away to find the old Rage driving the display at native resolution with a very decent looking image (even though this is over the analogue RGB cable). So I can confirm that the Rage 128 does support a 21.6" widescreen display at native resolution (and I would presume the same applies for 20" and 22" widescreen displays, since they all share the same resolution). I'll also mention that the B&W G3 tower is running Mac OS X 10.4.9.
In any case, I still don't regret having ordered the Radeon, as the Rage 128 does not properly support fullscreen slideshow mode and transitions in iPhoto 5, and my Dad spends a lot of his time dabbling with iPhoto slideshows.