Wired’s Gadget Lab has a preliminary look at the Asus EEE 900. It looks awesome but the price is getting a little high to be an ultra-affordable ultra-portable. I would say $400 is a max for a machine like this as you can get a full-fledged Dell laptop for around $600. The new EEE 900 is priced at $550 according to Wired.
I suppose you could get three of these instead of one MacBook. I really like the EEE, but the iLife suite is a great set of tools for students and I am not sure if the EEE, without a CD drive, would be as suitable for young kids, software-wise.