We fixed the problem. I gues after 2 days of trying, it took posting here to find the answer. Here is what we found:
To boot into a command line, at the Yaboot prompt, type "linux single'.
To configure Xfree86, at the root prompt: xf86cfg -textmode -xf86config /etc/X11/XF86Config -4
That brought us to a configuration page that allowed us to configure the monitor and video card. We put in our own custom sync settings that we got from an Apple page, and used "FBDev" as our video card.
I hope this helps anyone else who might have problems with Xfree running on an old G3 PowerPC.