Will Snow Leopard run older PPC software, pre-universal binary stuff?

It still provides Rosetta when needed, so PPC code will still run if it worked with earlier versions of OSX. There is no support for code that needs Classic or OS 9.

Make sure you have an Intel Mac. Your Profile says it's a PPC processor.

Make a SuperDuper bootable clone to bail you out in case something goes wrong.

Unplug your Time Machine drive for a couple of days. Tell you mail program to not delete messages from the server for a week after picking them up.

Slap that SL DVD into the machine and upgrade to 10.6 and then get the 10.6.2 update. Repair your Permissions with Disk Utility and test your new applications.

Major problems? That's when you boot from the SuperDuper clone and re-clone it to your boot drive. Nothing risked or lost at all.

PPC is supported, but there are some PPC applications that are too old for Snow Leopard. You should check all that you use for the latest info BEFORE updating. I think there are problems with CS2. It is not officially supported in Leopard, but may work there. CS3 is not officially supported, but does work.

Is there a 'best' way to upgrade? clean install and retrieve data from time machine backup? Complete rebuild? Install over the top of Leopard?

Any method should work if your applications are up to date, and your existing system has no problems. If your current system is old, though, it may have some forgotten applications or modifications that could cause upgrade problems.

The safest way (but more work) is to erase the drive, install Snow Leopard, update to 10.6.2, copy just user accounts and data from your Time Machine backup, and install the latest versions of applications.

If possible, make a bootable backup of your system drive before you start. That will protect you against any possible problems with the Time Machine backup.