The upgrade from 10.5.8 is to 10.6. Any program that runs under 10.5 should run under10.6. See this list for compatibility with 10.6: http://snowleopard.wikidot.com/ You might have to upgrade some drivers for printers, etc.... And you will have to install Rosetta if you have any third party Power PC applications http://www.macobserver.com/tmo/article/snow_leopard_installing_rosetta/
You can order a Snow Leopard 10.6 install disk for $29 from the Apple Store as long as you have at least 1gb of RAM and 5gb of free space on your hard drive. http://store.apple.com/us/product/MC573Z/A?mco=MTY3ODQ5OTY
To upgrade your iLife and iWork. If you only want iPhoto or other single apps from iLife '11 you can get them from the App Store after you've upgraded to 10.6.6. iPhoto, iMovie or Garage Band for $15 each and Pages, Keynote or Numbers from iWork '09 for $20 each.
Once you are at 10.6.8 you can upgrade to 10.7 Lion for $29 from the App Store. Lion will require at least 2gb of RAM but really needs 4gb to run smoothly. As for third party programs see this list for compatibility with 10.7 http://roaringapps.com/apps:table
Also Lion doesn't run any Power PC programs. To see if you have any Power PC programs go to the Apple in the upper left corner and select About This Mac, then click on More Info. When System Profiler comes up select Applications under Software. Then look under Kind to see if any of your applications are listed as Power PC. Universal and Intel will run under Lion.
Before Mac switched to Intel processors they used Power PC processors from 1994 to 2005. Power PC 601 through 604, G3, G4 and G5. Applications written for the Power PC processors need the application called Rosetta to run on Intel processors. This was part of the Operating System in 10.4 and 10.5 but was an optional install in 10.6. With 10.7 Lion Apple dropped all support for Power PC applications.