i had the same question - i do a lot of Photoshop and Illustrator work.
Firsty, the 1.2 GHz processor is actually quite speedy at these things - same as my 2.6 GHz Athlon PC.
Secondly, if you drop a Gb of memory in it, you will outperform the 1.33 powerbook for a lower price. If you drop in 512mb it will be a lot cheaper, and you'll probably still get better performances with a 1.2+768mb than a 1.33+256mb
Thirdly, if you want to screen span, use the screen spanning doctor.
Other than the aluminium case, i see no other reason to spend the extra money on the powerbook.
Unless you want the 15 inch one with higher screen size and resolution - but that's a lot more money.
Either get the 12" iBook and stick 512mb or 1Gb RAM in it, or spend a lot more and get the 15" Powerbook (and stick 256mb in it at least!)
Hope this helps.
PS. the reason i say the 12" and not the 14", is that apart from the 130mhz difference, and the 2" screen size, everything is the same. The screen resolution is the same, so you can't see any more on the 14", and it weighs more!!