Finally fixed the audio. Replaced the old crappy audio amp with a TP2024 based amplifier from eBay. That didn't fix the noise issues
I played with cables and stuff to no avail. Finally, after playing around with external sources and power supplies I figured an isolation transformer would help. A few days ago it arrived and I installed it. Still a bit noisy but it's not noticeable once the OS is loaded. The sound is okay overall but I don't have an original G3 to compare and my standards are way higher now.
Also replaced the hard drive with a 1TB Seagate SSHD. It's
much faster. Not SSD fast but it's pretty good for $100. Loaded up Windows 7 Ultimate, almost done installing software but still need some games to try.
One thing I never noticed about the machine before is how hot it gets. CPU runs around 70 degrees with any load, mobo temperature reads around 40 degrees (should be reflective of internal temperature). Ventilation isn't that good, the fan blows out some air and it's quite warm. Still, it's way better than the original, and it's within usable bounds, and there's not much I can do anyway.
Pics... tomorrow
As an aside, there are a few other iMac G3 conversions out there, but I'm pretty sure this is the only one with a functioning webcam, optical drive, and front jacks. Yes, I know that's specific criteria.