Re: It's a small single board computer - so?
If kids want the real low-level stuff then they or you could buy a FIGnition (http://sites.google.com/site/libby8dev/fignition/buy-it) @ £20, solder it together and program it in Forth. You will even get the 80's style 'joy' of extreme direct typing in of programs on an 8-button keyboard and trying to write the shortest lunar lander.
However, people are missing the point when they glibly say... "you can use any available PC to learn programming on" or "linux is too high level to learn how computers work".
The RasPi offers a lot of things...
+ An EXTREMELY cheap (~£30 delivered in the UK for Model B) standalone 'PC' which can be used for almost any type of home computing out of the box and programmed on directly (no AVR/PIC programming PC required). So it will allow kids to 'own' their own PC that they can plug in to their TV in bedrooms and get beyond just playing games if they want to. So exposure to personal computing outside of a rigid and somewhat limited school ICT curriculum with the ability to learn by breaking/hacking things.
+ The RasPi has GPIO pins available for direct hardware level hacking and there is a 'Gertboard' on its way which expands the low-level I/O capabilities (and you have to solder it together). Other 'add-on' boards are planned as well (including an on-board camera).
Personally, I'm just happy to get a very cheap, very small, very low-power, Unix-based single board PC that I can use to create any number of low-level home/car-automation projects with .. but with full support for high-level scripting and programming languages .. to create your own "Internet of Things".
The fact that the profit made from the hundreds of thousands of RasPi's being sold will be ploughed back in to creating teaching materials, hardware add-ons and supporting the development of computer science courses within schools is a rather nice side-effect.