Following an article on MSDN's Coding4Fun site I started playing with the Kid's Programming Language or KPL.
It's a very sophisticated language written in C# and the final code is actually a collection of .NET assemblies.
The development environment is a cut down version of many of the popular IDEs such as Visual Studio or NetBeans and the downloads, which are all free, come with a lot of playable games.
The idea is to encourage youngsters to program, using quite advanced techniques, so there is an emphasis on games.
I'm trying to get my nine year old son interested, he likes playing the games but so far doesn't show much interest in modifying the source...
Any one who teaches IT should really take a look at this product, although it is free please send a donation if you use it commercially.