Crucial, who I trust says that the most you can do is replace the 256s with 512s. HOWEVER, only one of the 256s is "user accessible" the other required fairly severe disassembly.
I would also like to know if I can install a larger (38 G).
Yes but it requires pretty extensive disassembly and some special tools, I think.
If you feel comfortable opening up your machine far enough to swap hard drives, you can probably change the second slot of memory at the same time.
Sagesse has answered your question but I'll just provide the extra detail you may need.
The iMac uses a standard desktop PC hard drive. It is 3.5" wide and in the iMac G4 uses the IDE connection. The iMac 700MHz 15" has an ATA66 bus so can use ATA66, ATA100 or ATA133 drives but not ATA33. You should buy a 7,200rpm drive with a cache of 8MB or higher as this also increases the speed.
It's very fiddly to work inside an iMac G4 so you must be cautious. Always take anti-static precautions. Here are three options for guiding you through the procedure:
I've also taken a fair few photos which you can find here.
I'd advise reading the reports on the xlr8yourmac's drive database so get other people's experiences first.
You must replace the Thermal Paste when you close the iMac up or it will overheat.
It's probably worth replacing the PRAM Battery whilst you're in there as these have a finite life (once they fail to re-charge you may start to run in to snags - it's only a $5/£6 part).
The hard disk should be set to Master (link).
You don't need any additional software; SpeedTools allows older iMacs (including some iMac G4 700MHz) that are unable to address hard drives larger that 128GB.
You might also give consideration to installing a 512MB DIMM or an 18x DVD±RW Dual Layer burner whilst you do this update; both of which will have to be removed during the process.
You must be very careful around the video connector in the iMac; it really is very fragile. In fact there is no need to touch it at all in my experience.
Thanks a million for the detailed answer to replacing the hard drive! I'll think about it for a while. I see now why Crucial offers only the 512 memory module. My mistake was in not understanding that 'up to one gig' meant using BOTH slots! Pooh! I'll keep in mind that, if I'm enterprising and brave enough to replace the hard drive, I can also replace the module in the factory slot! Meantime, I'll boost my machine with a 512 memory module.
I thought you'd like to know that I used this memory for my G4 flat panel:
XDEALRAM 512MB FOR FLAT PANEL
IMAC G4 PC133 SO DIMM
and it is working well! I bought it through 1-800-Memory.
I installed it about a week ago and have had no problems so far - touch wood! It looks odd to see 768 listed as my RAM!
Thanks for all your help!