It appears that under OS X Server 10.4, you must include a FQDN to allow the iChat server to start. If the only host domain listed is yourserver.local, the iChat server will fail to start (throwing a large amount of “org.jabber.jabberd: will restart in 10 seconds” and “too many failures in a row for a job that should be alive all the time” in the console.) By including a FQDN this allows the iChat server to start. Discussions regarding this issue have surfaced on Apple’s support site.
For those who wish to run their iChat server restricted only to internal use, this may require some DNS configuration editing as the iChat AV 3 client does appear to accept the use of username@yourserver.local as the Jabber account.