Sorry herbiesyufy, I was visualizing a 4-bay Mac-Pro when I mentioned "bay-3". Mac Pro and sugar-plums dancing in my head....
There's two problems I see in your reply.
You don't need to erase the 500 GB disk before using it as the target for CCC. And remember to copy the DMG back to the 300 GB disk (from the 500) before you pull the 300 out. Remember, the 500 GB disk will be erased when the RAID is created.
The other is that you'll only have 500 GB storage after making a RAID-1 from the two 500 GB disks (a mirror). You won't have 1 terabyte of storage like you mention.
The free DiskUtility app is fine if you only want to image the entire volume all the time. CCC lets you omit top-level items from the image. SuperDuper gives more control. Just make sure it's a compressed image (no blank space) unlike a disk "clone" which copies blank space (ie; a clone image of a 120 GB disk with 8 GB of data on it is 120 GB is size).
Installing the 300 GB disk in a Firewire enclosure is a good idea. You can boot the G5 computer from it if necessary (boot with Option-key down, choose FW disk).
With the 300 GB disk on a FW enclosure (with the DMG on it), and the two 500 GB disks installed internally, boot from your OSX install CD/DVD. Walk thru the first few screens, stopping short of actually installing OSX. When you see the Utility menu at the top of the screen, select Disk Utilty. Now you can configure the RAID on the 500 GB disks, and while still in DiskUtility, go to the Restore tab. Now you can select the DMG from the FW disk as the source, and the new RAID as the destination.
I personally backup my iPhoto library by burning DVD's of the dated photo folders every couple months. Even though I've got DMG's of my disk (photos included), I don't want to trust photos I can never re-take to one type of backup.
FYI - the images you create from your PPC system won't work on a shiny new Intel Mac. Use Disk Utility on the Intel system to do those, and keep them separate from the PPC images.
Good luck! --Brad.