I'm going for the latter.
I have a mixture of USB and FIrewire external drives and none of them have a problem booting.
Certainly your iMac will boot from Firewire or USB without a problem and this has been the case with Macs powered by the Intel processor since the first one.
All Macs have been able to boot from FIrewire since its introduction may years ago but USB booting will only work with Intel powered Macs.
Both Seagate and WD drives, at least all the ones that I have owned have been capable of Firewire booting and USB with the correct machine.
A couple of my drives were doing duty attached to a PPC mac and are now in USB enclosures and booting as expected.
Without teaching you to suck eggs, how do you have the jumpers set on the two drives?