Just wanted to chime in to say that DS1 got a refurb DS Lite for his birthday at the end of March, and we haven't been able to tell the difference.
It was bought at GameStop, and was probably no more than $100. (It was a gift.)
DS1 loves it -- and we only have a couple of games for him. (Not on the spectrum, so no help there.)
And Nerf sells a case for the DS that would probably work well to help protect it. (We have a Lego Star Wars case that has helped it through several falls already.)
Keep in mind that you can get a DS now, see how it works for relatively low cost, and upgrade to an iPod later if that looks like a better platform. The DS will always have games for the kids, so it wouldn't be a waste. And, as someone has pointed out already, three DS's will be much less than three iPods, refurb or not.
mommy to three boys: A, 3/04
and identical twins B and D, arrived 9/08