Crash code 00000F 000001: MC68000 Exception - Bus error. Likely cause: The medium that was loading the System Software could not load the error handler included with the System Software. This is most likely caused by either forced removal of the medium while loading, or a corrupted medium. Remedy: Do not remove the medium until the System Software has completely finished starting up and disk activity has stopped. If the disk is corrupted, try to use Disk First Aid to repair the directory structure. Start it up using the System Software Disc that came with your Macintosh. Failing this, re-initilaize the disk and reinstall the System Software. Failing that, replace the disk.
Since it's OS 7.6 it will be 68k code running on a PPC system. I forced the failure to happen by inserting the CD drive once the happy Mac appeared, where the OS is loaded. Fantastic observation! Thanks for the comment and explanation.