I would say go with 8.1. The UI isn’t that much different from 7, and it has significant new security features that 7 lacks (like using SMEP on new CPUs). If you decide you don’t like the start screen, you can get utilities to bring back a start menu for a lot less than $100.
Like free
Windows 8 is not as bad as people make it out to be … it requires to get used to, but that’s it.
Kids either have no issue what-so-ever with it or have issues with Win7 as well.