I would even chose a Play Station 2 or a Game Cube over a DS.
I wouldn't. Kids always want the newest and best stuff (I know I did). When I was a kid I wouldn't have wanted to play with an eight year old gaming system. It just wouldn't be 'cool'.
The DS really depends on how many friends have it, from what I gather. They create a mesh network between nearby devices, and allow you to play against each other.
The wii requires a TV, and also space to move around and play it in. A kids bedroom may be too small to adequately play, so the living room may be the only choice. Just something to keep in mind, if you don't want your living room TV taken over
However, wii's thus far have held their value exceptionally. Not sure how long this will last, but I have had one for over a year, and it wouldn't surprise me if I could sell it for a profit this christmas season.
For both the console and games, I would recommend keeping an eye on craigslist. You might find a used system for cheap from someone that needs money to buy gifts. Also, ebay/craigslist is great for games. People often want to get rid of games they have beaten, but gamestop usually will only give you a few bucks to trade it in. Its not uncommon to find games for $15 bucks in perfect condition that are $40 new.