So my iMac is back with me, how I missed this computer, especially after struggling with playing WoW at 10-15fps :(

The engineers report said what I suspected - that the graphics card had died and needed to be replaced. Not entirely sure why it failed, either it just was manufactured badly and was a ticking timebomb, or possibly it's because of poor cooling inside the machine cooking the chip when used heavily under load, something I've seen hints of over at the Apple support forums but isn't confirmable.

If i get another couple of years use out of this machine I'll be very happy indeed.