Start up the computer in Safe Boot mode. This will let you uninstall XPF since it won't load in safe boot.

Why it doesn't work? I don't know, I have never used XPF. My only other suggestion would be to reinstall 10.3 fresh, update to 10.3.9, and try again.

Or try removing the HD, putting it into another machine capable of installing 10.4, then put it back into the iMac. That method has worked for me many times.