I just upgraded my sin's iPad off of Craigslist and got a fairly good deal. It's an iPad 1 with 64GB, 3G, and wireless for $225. Hs old iPad was 16GB, without 3G and I believe we also paid $250 for it. We sold it for $225, and so out of pocket for the upgrade was $25.
Personally with kids that young I wouldn't go for the latest and greatest. iPad's are pretty dingaling friendly, and tough to goof up. They are used a lot with kids on the spectrum as communication devices, and in many speech/language clinics. Both of my sons have very mild forms of autism, and their speech person uses iPads with them during each session. I believe all of the SLP's in clinic have and utilize them frequently.