Well I just bought a processor upgrade and they sent me one that was built incorrectly...not a big deal I just have to send it back. I just thought I was an idiot because after I installed it the case wouldn't close and the rep told me I installed it wrong...turns out they built it wrong, they put a heat sink in the wrong place so it hits the dvd drive bay when I try to close the case. So that's what took up all last night for me, trying to decide whether I am dumb or the rep @ gigadesigns is dumb. Looks like he's dumb. anyways...
As far as your HD situation is concerned, I doubt that is any factor in the failure of your processor. The G4 towers are designed to fit four HD's, an optical drive and a zip drive- and allow all to operate without drawing too much power from the power supply or disrupting air flow. You really don't have much to worry about as far as how much you pack inside your box, as long as it was meant to be there. As soon as you start putting stuff where it's not meant to be, then it is time to go external.
When I say that dust could be causing problems, it can only be because of three things. The most common problem is that the fan is clogged with dust, and the dust blocks the heat from getting out of the box. If you keep your computer on the ground and don't often open it or even really touch it, then this may be an issue. I'm always inside of my computer so any dust that gets in there usually doesn't get to stay =). The second would be, like I stated before, that dust can get around the processor, in the grooves of the heatsink and even under the mother board. The processor needs to be making perfect contact with the heatsink so the heat it produces dissapates properly. Anything in the way or next to it could be a potential harm, although i've only heard of a few cases. The third would be kind of like the second but, basically that if dust gets collected over or under any of the circuitry, it could cause a short, depending on what it is composed of. Obviously the logic board or mother board wasn't meant to be run while it is caked with dust on it composed of random materials.
A lot of this is all in theory or stories that I have heard, since it has never actually happened to me. But one thing that I learned from it and I think applies to most machinery: Keep your computer clean!!! The cleaner you keep it the longer it will last. The less strain it will put on the hardware and thus allow for better performance as well. The same rule applies with the computer system- the cleaner you keep your OS, the faster and smoother it will run. Constant internet downloading and surfing, leaving your computer run constantly without often restarting and just plain not being organized will lead to a corrupt system eventually if you don't clean up after yourself. If you don't have any cleaning programs I suggest you download one and run it at least once a month. I run three every week. A great freeware program is onyx, it cleans system files as well as internet files. After running it I notice my startup times always benefit from it as well as my spotlight index.