Great thread! I second the telescope recommendation. We bought a cheap National Geographic one that turned out to be absolutely terrible, so will have to check out the one posted here.
Another thing that DS enjoys is his Redshift 7 planetarium software. You can buy a license for about $20. There might be much better software out there, but that's the only one we've tried.
I just noticed this:
http://www.stellarium.org/ETA: The Galileoscope seems to be $50 most places. I found it here for $28.95, resulting in $39 and change shipped to me on the East Coast. Buy at your own risk, of course; I've never ordered from this place before.
http://store.exploratorium.edu/browse.cfm/galileoscope/4,5237.html
