It is looking like there will be one final generation of Powerbook G4s before we see a Powerbook G5. That being said, I really do sense that a Powerbook G5 will at the very least be announced sometime in 2004. There are some pros and cons to purchasing a Powerbook G4 at this point in its life cycle.
First off, most of the quirks in the Powerbook G4s should be worked out by now. By quirks, I'm referring to actual faults in design and construction. I haven't heard of any faults plaguing the current Powerbook G4 12" model. Let us assume a Powerbook G5 does ship some time this year, or even a slightly upgraded Powerbook G4, it may have defects. So you might wait, be one of the first to purchase a unit only to find that you're stuck effectively beta-testing the product. So it is definitely an advantage to know the track record of the current models. The 15" has been problematic but the 12" seems to be very reliable.
The major con in this scenario would be if you bought a Powerbook G4 today and a Powerbook G5 shipped in the coming months. Simply put, the performance delta between the Powerbook G5 and Powerbook G4 would definitely be noticeable and you would likely get more bang for your buck from the Powerbook G5. Since Apple usually does a total redesign of a laptop when introducing a new generation of CPUs, it might also bring with it a better screen, be more rugged, be thinner, etc. You might miss out on all of this. Also, there is software out right now that I would only contemplate running on a G5 machine for satisfactory performance - Garageband being the most prominent example. It looks like Apple is aggressively moving in the direction of using up all the power afforded to them by the high-bandwidth G5 architecture, in their software. So for longevity's sake, a Powerbook G5 is more future-proof by a greater margin.
So really, I think you have two choices. If the Powerbook G4 suits your needs right now, I say go for it. But if you're looking to start fiddling around with more CPU intensive tasks, I would really wait for a Powerbook G5. I wouldn't bother holding out for an upgraded Powerbook G4. The improvement would only be incremental, whereas if you wait for a Powerbook G5 the improvement will be substantial.
Now, I would suggest another option. Have you considered an iBook G4 12"? It shares much in common with the Powerbook. And it is much cheaper. The Powerbook has a slightly better GPU, has DVI output, audio input, and the option of a Superdrive (DVD-RW). Those are really the only features that set it apart from the iBook if you ignore CPU specs. The Powerbook 12" actually doesn't have some of the features the other Powerbooks have such as Firewire 800 and Gigabit Ethernet. So it's not a "full" Powerbook and is more of a Powerbook/iBook hybrid. As far as resale value goes, I do not think the iBook will be getting a G5 anytime soon. So you might be able to turn around and sell the iBook G4 next year and get more out of the sale than if you were to purchase a Powerbook G4 and try to sell it when Powerbook G5s are on the market. Then you could put this money towards a Powerbook G5