Scratch, from the Lifelong Kindergarten group at MIT, is this lovely environment for kids (or other novice programmers) where you can make funky animations and play sounds and do cool effects! The cool effects are a major selling point -- you can get funny animations right off the bat. Everybody loves a fisheye effect. And it has this lovely website, where kids can share and tag their projects! Web 2.0 ahoy!
It's really easy to figure out, especially if you've seen things like the LEGO mindstorms interface, or Alice -- commands snap together with a familiar building-blocks metaphor. This is to say that there's a fairly standard vocabulary for childrens programming environments, these days...
The Scratch intro "Facilitorial" video is here.
Also fairly interesting (and brand new on my radar as of today), is Greenfoot, which is another educational programming environment, perhaps for slightly older kids. It makes it easy to do simulations with different kinds of "actors" on these nice 2D worlds (they can be grid-worlds, but they don't have to be)... although you have to write some Java, it looks like, to build up your new behaviors. Maybe this is awesome too.