I have an Eee PC 4g model 701 and both my 13 and 16 year old love it, and are aching to have one of their own. They're both saving up to buy themselves 2Gs, though if the prices keep falling they may be able to afford something better.
I get along with the screen and keyboard fine, they don't even notice that they might be a problem.
I think they make great systems for kids this age.