The thought just struck me that it might be worth it to edit our dv footage like some edit HD stuff with this proxy thing (pretty ignorrant on it really). Would there be an advantage given our 1ghz upgraded G4 (Sawtooth)... can you downsample the footage without recapturing it or is it actually quicker just to recapture it.

Or basically am i way off base and if I want better performance need to just shut up and pony up the bucks for better gear? (though this is the last item in the budget right now as we are very young and growing.)

FCP has had this capability since version 3 IIRC. Take a look in the manual under "Offline RT". They originally provided this as a way to edit uncompressed video, and to make the software more usable on G3 powerbooks with small hard drives.

Personally it seems like a lot of trouble if you're just working with DV. What version of FCP are you using? FCP 4.5. which introduced "RT extreme," was a huge improvement over FCP 3 on the older G4's. While in South America this summer I edited a lot of PAL DV on my 1ghz Powerbook G4 with firewire drives. I'd gotten pretty spoiled by my dual G5/2.5 at home, but was pleasantly surprised at how responsive the powerbook was, once I fine tuned the RT settings. Of course rendering takes a lot longer, but editing was fine. FCP 5 should be even better by all reports (although I've only used it on my dual G5 personally).

But of course, faster G5's are much nicer....