Arinda,
Ah, the age-old question!
You are absolutely correct in your thinking, at least as far as "it seems to be working fine" goes. Truth to tell, I wouldn't consider your computer all that old, but it is nice that you have it listed in your profile, as this allows us to make some solid estimates of the results of any upgrade by you.
I can't tell you whether an upgrade would be right for you, but I
can tell you what the possible consquences would be, good and bad.
There is no doubt that each upgrade to OS X brings with it increased speed, increased stabilty, and increased function. Tiger, especially, has a tremendous amount of "new and cool" features, and it all seems to have come together for Tiger in the latest update to it (10.4.3). Your computer
would be faster running Tiger, it
would be more stable, and you would have
fewer problems.
The downside to all this, in addition to any cost, is that Tiger also brings with it some additional "candy" that tends to want lots of "horsepower." Panther is mostly just a smoother-running (and faster) Jaguar, so this doesn't apply to the upgrade from 10.2 to 10.3. Tiger, however, can be an absolute monster in its need for power, especially in the graphics department.
Its a trade off. Yes, your computer will do many things better and faster than it did before with an upgrade to Tiger, but your older iBook will, at the same time, have a harder time trying to handle what Tiger throws its way.
Remember, your computer runs at least as well now as it did when you bought it, and it can do all of the same things. If the time comes that you feel you would like to do more, well......
Scott