I'm EXTREMELY happy to say that the new ram I got today, I put into the G4 and it fixed the problems. I was now able to boot from the restore discs and I restored my Power Mac to factory settings ...which installed OSX 10.1. Afterwards I booted to the OS 9.2 CD reformatted the drive and now I'm able to boot to the OS with no problems. Also, before I did the restore discs I ran the hardware tests again and everything passed, so the problem the whole time was a bad ram stick.
I just wanted to say again thanks to everyone that helped me with this problem [Chris. DieHard, Mactron and everyone else] I really appreciate the help.
Chris, DieHard, thanks for sticking with me all the way till the end on this issue...you guys are the best.