If your son want an IPOD, I recommend paying a little extra and getting the IPOD Nano. It has a solid state memory (no moving parts), whereas the larger IPODS have drives in them (moving parts -- drop them and they can break).
I recently got IPOD Nanos for myself and DH at Costco for about $10-20 cheaper than on Apple's website. Plus, Costco has such a liberal return policy that if something goes wrong in the first few months, I know I can just return the IPOD to Costco instead of dealing with Apple. We have seen the IPOD Nano recently on sale at Target for $25-$30 less. I paid $190 for the 2GB Nano and $240 for the 4GB. A 2GB Nano will hold up to 500 songs (at 4 min. per song) and would probably be sufficient for an 8th grader.
The face of the IPOD scratches very easily, so you'll want a case before anyone uses the IPOD. I would recommend a case that has a plastic cover over both the IPOD screen and wheel, a belt clip to hook the case to pants or a belt, and cutouts for the earbuds and computer hook-up cord. DH's case only has a snap to hold his case to a belt or belt loop, but it has cutouts for both the earbuds and computer cable. My case has a traditional belt clip that can hold onto the edge of my pants, but it only has a cutout for the earbuds so I have to remove the IPOD to hook it up to the computer for downloads. A good case will cost $25-$35.
Your son would be able to download music from his own cds, but he'll probably also want to download some music from
http://www.itunes.com. Songs there cost $0.99 per song. You might consider purchasing your son a giftcard so he has money for downloads.
You can buy an IPOD online from
http://www.apple.com (the manufacturer -- free shipping), you could try Costco, Target,
Best Buy, Circuit City, etc.... Also, your local mall may have an Apple Store. You can buy cases from Apple, Target has a good selection, and Radio Shack had quite a few here.
Good Luck!