what will the kids be doing on it? I would also suggest that 2 kids sharing one is a recipe for war...either one each or an entirely different gift would be wise IMHO
My 9 year old loves his kindle fire and the 13 year old loves his Nexus. The younger ones use my old iPad but I wouldn't buy them an iPad (they are lovely but over-priced).
Yes, they are like all tablets. You can down load apps, go on the net, read books, go on YouTube (as far as I can see they do exactly what an iPad does).
My great nieces (8 and 10) have got ipads. Their parents can well afford it and they chose ipad over other tablets because they decided that the the control they could have over what the children did and looked at seemed to be the best. If I was going to buy a tablet (or laptop or netbook) for a child, then that would be my main concern.
The children are both careful with fragile things and understand that they need to take care of their possessions
You can set up parental controls on other tablets too. I have an iPad and love it but I really don't think they warrant the price (although I am not going to give mine up in a hurry).
That's the problem with Kindles - they are android but reworked to Amazon's interface.
You can't borrow ebooks from a public library with a Kindle and I'm not sure if Kindles have full access to the Google Play apps.
I would go for the Hudl personally, at that price point. Kindle Fire is great for reading books, but it does have a proprietary OS that makes trying to download anything other than Kindle -approved apps a bit tricky.