Hello,
Apple has their computers set up to prevent booting or installing a version of the Mac OS that is earlier than the version that the computer shipped with. This ensures that the version of the Mac OS you install is aware of the specific needs of your computer (how it's power management system and cooling system works, etc.).
This method prevents you from installing a version of the Mac OS that is even 1 revision older. So, if your computer came with 10.4.5, then you will not be able to use that computer to install 10.4.4.
So, you will have to use a computer that originally shipped with OS 10.3 or earlier to install Panther on that drive.
You need a machine which shipped with the exact same version of OS 10.3.x that you are trying to install or earlier.
Additionally, there are times when a version number is slightly different for each system. For example, say 10.3.5 was already out when your system was first introduced. But, then lets say that your system required some tweaking in the OS to support new design elements in your system. In this case, the version of 10.3.5 that came with your system would be a slightly newer build than the official 10.3.5 version. So, in that situation, you wouldn't be able to install from a retail set of 10.3.5 disks because that version is technically older than the version that came pre-installed on your computer (even though they are the same revision number).
You see, while us consumers use the revision numbers as distinguishers, Apple uses "Build" numbers.
The "Build" number reflects the exact version of the OS (with all changes accounted for - even software updates adjust the build number).
So, you need to be sure that the "Build" number that came with the system is older than the build number of the OS you are trying to install.
So, if your Panther disks are 10.3.5, then to be certain it will work, you will need a computer that shipped with 10.3.4 or earlier. A computer which shipped with 10.3.6 will not install from a set of 10.3.5 disks (even if they are being installed to an external drive). And, as explained above, a system which shipped with the same OS version number may not install it either.
So, you specifically need to look at the disks you have, and see which version of OS 10.3.x they are (somewhere between 10.3 or 10.3.0 and 10.3.9).
You then need to find a computer that originally shipped from the factory with that version of 10.3.x or older to install the software onto your external drive. And, preferably, it should be a system that shipped with at least one revision number prior to your disks.
Now, another issue, is that you specifically will need the OS 10.3 Retail box version to do this anyway. You will not be successful using the 10.3.x disks that came with a computer. You need the retail box version.
The disks that came with a computer are "keyed" to that computer. So, they can only be installed using that specific computer.
In the end, I think your best solution is to just install the hard drive into the iBook G3 that you intend to use it with, and use that computer to install OS 10.3.x from a set of retail box disks.
I hope this helps.
