The Swiss Army knife idea is a good one. Along those lines I'd say get him a 3 1/4" (84 mm) Alox SAK, then have the back engraved with his name or initials to make it extra special.

For kids I always liked the smaller 3 1/4" size SAK, it's more proportional to their hands and pockets than the full size knives (3 1/2"-91mm). Target has been selling the 84mm Cadet Alox for ~$18.00 (pictured below), which is a good simple sturdy knife. Very similar to the original Soldier model, which is also similar to the old US military Demo knife or the traditional Boy Scout pocket knife. The difference is the smaller size, the pointed nail file instead of the awl (which can do most of what the awl could do, with the added benefit of the nail file) and a key ring, which is good for kids so they can tether it to themselves so they don't loose it.

If you want to go full size (91 mm), the Farmer is one of the best, and being Alox it also has a spot to be engraved. This one is, again, similar to the original Soldier, but with an awesome wood saw and the key ring.

Another knife I like is the Case Orange G10 Jr. Scout. Basic boy scout knife design, but with bright orange G10 handle scales so it's easier to find if dropped/lost. This one is a bit more expensive than the SAKs though, it's also not as easy to replace if lost (they're kind of tough to find).

If you prefer something with a lock (which is always nice to have), a simple small lockback is a good option as well. My father always got knives like these as gifts/promotional items, and he would give them to us. They're simple, durable, and with only one implement to worry about, the blade....they're pretty easy to teach how to use. Plus, once they're a bit older you can buy them a Buck 110. Basically the same knife on a larger scale, and is pretty much known as the classic American pocket knife.

Case makes small stainless lockbacks that are real nice and not too expensive, as does Buck and quite a few other manufacturers.

Otherwise, I would look into other classic style knives in different patterns. Case, Buck, Bear and Sons, Queen, Schatt and Morgan, Hen and Rooster, Boker, Schrade (now defunct), Camillus (now defunct), ect all made/make great knives in classic patterns; like the stockman, barlow, trapper, pen knife, ect. The price on these can be very low (like the Chinese made low-end Buck slip-joints) to very high, allowing you to pick out one you like at the price you like.

While it may not be feasible since you want to give it as a Christmas present, it may be a good idea to let him look at or maybe try out different knives and pick out the one he likes (within reason of course). Either that, or start him out using your edc pocket knife, and then get him his own of the same knife once he has shown satisfactory ability/safety. Sometimes allowing them to pick out their own knife or giving them the same knife as daddy/grandpa/uncle/ect makes it more fun and memorable.