Hello again.
Okay so I found a work around for the moment and updated my system to Xenial. Unfortunately I went too far after finding even more updates and ruined it. But I'm working on a fix.
So the work around is simple. Just disable the extra xenial packages. Keep the standard xenial dist with main, multiverse, restricted and universe. Then the auto software updater can work. The package list can be refreshed without errors. And it will then update to xenial without errors.
Unfortunately it will lack the security updates. All the extra packages are there on the server obviously but the missing powerpc index in release file will block them from being found. Suppose the best move would be to collect all the updated packages and then set up a repo like is done for Debian on A1 at SF.
After it updated, I freshly booted it, only to find it dropped me at a shell with root RO. Turns out this is common but I don't know know why the updater purposely breaks the setup. So if you have a "/dev/sdx" as your root in fstab it will delete it as it only likes UUID. This is fine but why delete the root entry so the system breaks? It could convert it instead. I managed to recreate it after remounting RW and loading Disks which I used to create new entry in fstab. But now there is some mount message on boot in log about some change.
So I managed to break the system after getting it updated (again). I did some more apt update, upgrade, full-upgrade and dist-upgrade until it fully upgraded which worked fine. I found an updated server ISO for powerpc dated 2019 which was fairly recent but still behind the 2021 xenial EOL. I managed to mount the image and use apt-cdrom to add it. I looked up instructions online and it seems despite CD images rarely being burnt to CDROM any more that it still lacks support for scanning and using a mounted volume as a software source. I tested advice, found most of it didn't work, until I found a way for it to work. It can only work for one disc image at a time. Small guide here:
1. Mount your CD image as a loop at /media/cdrom.
2. Issue on a terminal: apt-cdrom -m add.
After updating with packages from the server ISO I rebooted to find I was a shell again. Despite having fixed this. I tried to run startx but the X11 server froze the terminal with cursor blinking. I had to force reboot. Somehow I had broken the desktop as some packages like systemd were held back. I let apt remove unneeded packages and it somehow must have removed desktop files. So I must reinstall ubuntu-desktop and associates.
I found, after searching all over the net, that newest xenial images were hosted here:
https://vivapowerpc.eu/software/Ubuntu/
lubuntu-16.04-desktop-powerpc.iso
ubuntu-16.04.6-server-powerpc.iso
ubuntu-mate-16.04-desktop-powerpc.iso
However there is also an extra archived mate with 16.04.1 from 2019 and a 16.10 from 2020:
https://releases.ubuntu-mate.org/archived/16.04/
https://releases.ubuntu-mate.org/archived/16.10/
Grab it while it;s hot!