I hadn't bothered even trying this before because all avenues pointed to the fact that it shouldn't/wouldn't work - but someone else did the obvious and simple thing and now we can all benefit from the result without nagging doubts.
Want to boot your PowerPC Mac from an external USB 2.0 drive? Piece of cake! Clone your current system over to the external drive (or install a shiny new system if you prefer), restart while holding down the Option key to get into the boot manager and select that external drive as your startup disk. Yes, that's right - it's the same process you'd use to boot from a Firewire drive. I don't have a USB 2.0-enabled Mac handy at the moment to test this with, but I'll take the MacOSXHintster's word for it since a few commenters there also agree. The consensus is that it's slow as molasses but it does actually work. No Open Firmware voodoo required. Score: Laurie - 0 | Blatantly obvious solution - 1