Yes you will need to slow down the drive to SATA I (1,5 Gb/s) as your systems SATA interface is only SATA I.
You may encounter issues with these larger HD's depending on the OS-X you are using on this system. Review this Apple TN: [http://support.apple.com/kb/HT2422|Mac OS X: Mac OS Extended format (HFS Plus) volume and file limits].
But before you start this project are you sure you want to make this investment on such an old system? Remember this system, OS and apps are not supported any longer. It also is very exposed to internet viruses and trojans if you are using it online.