If you're looking for the cheapest price on anything, maybe I can help with that. At my LHS, I get 20% off everything I buy, so I can get a Rustler for ~$110. If I can look more into it, I can buy the stuff and send it to you for lower than Tower's price.
Anywho, what I have learned from watching my little cousins (4 and 6 I belive), is that is obligated to get two of the same. Now, they would like that because no truck will go faster etc etc. but it would get boring real fast having two of the same.
I'd agree that a Traxxas would be a good starting point. They are slow (~25 KPH) and built very bulky so they won't break. Of course, there is the exeption of my bud who has a pede. We brought my 2 foot tall ramp up on top of his house and we aimed it at the bed of his Toyota pickup. Of course, it got like 30 feet of air, clipped the truck, and broke the A-Arm and the shock tower.
Now, we get to the section of upgrades. The only thing I would upgrade on a Traxxas are wheel bearings, aluminum idler gear, and a new motor. More then that and you should sell it and get Evader PROs, Losi's, T4s etc.
And I'd also recommend the GP3300s from RadioShack. For a charger, I'd rather get two separate chargers rather than one. The [link=http://www.horizonhobby.com/Shop/ByCategory/Product/Default.aspx?ProdID=DYN4044Dynamite Vision Peak 2[/link] is a good one. The only computer charger I have been comfortable operating is my Triton, but thats $120, and DC only.
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Enough about the kids, aren't you gonna get yourself a RC and join in the fun!?