update-grub works fine on my PowerBook with the same version of
grub-ieee1275... Did you make any configuration changes such that
${GRUB_TERMINAL_OUTPUT} ends up as gfxterm? Or do you have
grub-splashimages installed maybe? (I don't)
--
Earthling Michel Dänzer | http://www.vmware.com
Libre software enthusiast | Debian, X and DRI developer