Can iMac run without display and optical connections

I'd like to answer this and add a few tips -

1. Yes, you can remove a broken/faulty iMac 17" intel display, and use the iMac as a server. Just disconnect the display data and power cables.
2. You can use a DisplayPort to VGA or to HDMI dongle to run an external display (helps at the initial setup stages anyway, if this is to be a headless server).
3. Some users VNC/ScreenShare to their headless servers from another device - this usually works only low resolutions, or causes visual artifacts/graphics glitches, and is sluggish. The solution in my case was to take three 75 Ohm resistors and a DisplayPort-VGA adapter and put the resistors across 1&6, 2&7, 3&8 holes in the VGA female side - well documented elsewhere like this: http://www.geeks3d.com/20091230/vga-hack...

It is common to read of the same problems affecting headless mac minis - the reason being that the GPU is not active unless there is a display attached. The GPU does the graphical heavy lifting usually. The resistors trick the iMac into using the GPU (easing the load on the CPU), and giving you more resolutions options.

The difference with the mac mini solutions is that they normally suggest just pins 1&6 or 1&7. None of these worked for my iMac

Note that you need to reboot the iMac for it to recognize the dummy adaptor mod. You can check it has worked by looking at the Displays in the About this Mac under the Apple menu - you will see "VGA Display" instead of "No Display". Also I should note the graphics card in my example is an ATI Radeon X1600 128Mb.

I now have a crisp, clear, responsive ScreenSharing session. I also ran xBench in both configurations and found that the OpenGL Graphics Test and UI tests were far better - 200% better in the OpenGL test.