I doubt it will be a G5, and if so, they'd probably have to redesign the case. The iMac is an overprice, slow, joke. In 18 months it's gone from 800 MHz, no L3 to 1000MHz, no L3. Sadly, they are unlikely to go above 1.4 GHz given how stuck the G4 is. They will likely still hobble it by leaving out the L3 cache. No wonder iMac sales are in the toilet. I'd like to see prices down to $1299 for the SuperDrive model, $1149 combo, and $999 15" combo. Even that would be pricey.
What PC out there is only 20% faster in the real world after 18 months? None. The iMac 2 was competetive for about a month when it was introduced. But it shipped in volume about 3 months later than it was supposed to, so from the moment it was out it was not a very good deal. Then they had the idiocy to raise the price while sales were already weak. Apple's latest brilliant move is to heavily advertise the G5 which nobody can get their hands on and likely won't for 2 months. People who need computers need them now! They don't think, well gee, I'll go back to a typewriter or a pad and pencil for 3 more months since my PC died because I'd like to wait for a G5. Apple should fire whoever is in charge of their marketing and pricing. They've been totally unable to grow Apple market share and the reasons why aren't hard to figure out.