To reset an iBook G4 to factory settings without the setup disk, first, restart the computer and hold down the Command (⌘) and Option (⌥) keys along with the "R" key to enter Recovery Mode. From there, you can use Disk Utility to erase the hard drive. After erasing, you can reinstall the operating system by downloading it via the internet or using a compatible OS installation from another device if available. If Recovery Mode doesn't work, consider creating a bootable USB drive with the OS installer using another Mac.
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