iPod touch Setting up a itouch for a 10 year old?

I'm giving my 2nd gen 8gb touch with 3.1 to my 10 year old for his birthday.
I want to kid proof it and set up parental controls. This seems to be limited to three areas; case protection, internet limiting (youtube, safari etc.), & itunes charges.

1)Any suggestions for the best case protection? I use a leather case but when he uses my touch he *always* takes it out of the case. He needs a wrap around that might give it some shock protection. I also have a hard acrylic case but it doesn't seem to have enough shock protection.
What about this?
http://www.switcheasy.com/products/R...ebelTouch.php#

2) I was thinking of using a combination of the settings parental controls & a app called mobicip for $5
http://www.mobicip.com/online_safety/ipod_touch

3) This one has me stumped, if I set up a gift card itunes(is this possible?) account on his computer(a 8 year old pc again a handme down) then he won't have any of the games I've already bought. Or will the new home Sharing feature allow me to share apps too?
Or I could sync it on my computer & not let him have my password for the itunes account. The advantage would be access to my tivo'ed converted for ipod shows.
I'd love to have him on his own itunes account tho. He needs to manage his own pod.

Thanks for the insite!

I ordered the otter case. it seems like the best shock protection out there. I'm being over protective with it but he's been pestering us for *months* & savig up his hard earned $ for a touch, I'd hate for it to get broken.

I'll explore setting up itunes with my account on his computer. That's a good idea, thank you.

I may let him buy the mocipi app if he want's to get on the web.
B-day is on Sat.

TraceyS/FL said:

I have the machine authorized, but when they go to iTunes, it is not logged in. They just give me a list of things to buy (because, with a click happy 5yo.... well, i can't afford her obsession with Taylor Swift )

Click to expand...

Agreed, while I don't think my son will intentionally spend a lot of money, he could get himself into trouble by not realizing the cost of app's or movies etc. We''re still at the point that mom & dad ok the stuff he buys, just so he's not disappointed & feels like he didn't get good value.