There obviously should be more research put into the whole non profit status, but I'm willing to help pursue it. Not exactly sure if thats what we really want/need, but it's a start.
I really hope this project has not "died".
It showed so much promise....
i havnt read this whole thread,
but hopefully no one else has said this yet.
But they do have a linux for kids distro already.
not sure if these help or not. But, i think they key would be to get non profit status. I sill like this idea, and not sure if you have given up on it or what. The links i provided are things available or already running in colorado. There doesn't really seem to be one in the Fort Collins, or Loveland area though. This should be an excellent opportunity to start one. I should be attending CSU next year, so maybe i can get something started up there.
I know I'm a little late coming into this, but hopefully everyone here is still active in this project.
I am from Florida, and last October my wife and I have established a charity that does exactly this, we take donations of old computers, put Linux on them, and give them back out to low-income or special needs kids. You can get more information about us here: http://www.quinncoincorporated.org
Like you guys mentioned, we needed a clean, simple interface, that was lightweight enough to run on older hardware. To that end, we developed our own Linux distro called Qimo (http://www.qimo4kids.com) that is based on Xubuntu, and comes with open source, educational games. Plus it runs as a LiveCD!
We recently showed off Qimo at the Southern California Linux Expo, and got lots of interest in the project, and the charity. We are working with others across the country (including Colorado) to help groups like this get off the ground in their own communities. If you are interested, you can contact us at firstname.lastname@example.org for more information.