Finding a good instrument isn't as simple as brand names. I've got three guitars of my own, all second-hand, no-name brands. And they all sound good. I've also seen some really, really bad ones, including DD's starter guitar, and one for a neighborhood kid. That kid's sister had a Walmart special with Disney princesses on it, and that one is pretty good.
You've got to play it to evaluate it. You have to hear that it stays in tune as you move down the fretboard, but not buzzing, and feel that the action is consistent, and easy enough for small fingers.
Depending on the instrument, you may be able to adjust some things to fix these problems. But some you can't, as in the aforementioned mini-electrics with no truss rod. Classical guitars don't usually offer anything to adjust except the tuning, so what you hear is what you get. And any instrument you pick up off the rack at a decent music store should already be set up properly, so you should be testing it at its best.
For small children I definitely recommend a classical guitar, because the nylon strinfs are so much softer, and their fingers are so much more sensitive. My DD doesn't practice long on her acoustic-electric because of it, but she'll jam on my classical guitar (which is absurdly huge for her) and lay her head against it with a look of pure bliss.
And as HK said, the small classical guitars get very poor resonance.
