You need to determine what the use of the device will be, and then pick the best device.
If he needs voice, or mobile data, then a smartphone will be the best bet. (Personally, I'd recommend a good Android smartphone.)
If he needs iTunes, then an iPad or iPhone might make sense... I agree with you that they tend to be overpriced, but on the other hand they're excellent for people who are non-technical.
If he wants to access Amazon Instant Video from the device, then the Kindle Fire is probably a good choice. Beware that the shipping version of the Kindle Fire does not support the Google app store (now called Google Play). (It can be made to access Google Play, but it's rather technical.)
If he doesn't need Amazon Instant Video, then I'd suggest that you consider the Nexus 7. It's an Android device, about the size of an iPad mini. You can install a Kindle app, and use it as a Kindle. You can access Google Play. Retail is about $250.