In my humble opinion $5 is not at all reasonable. You won't find just a decent pocketknife for $5.

My thoughts:

Use the essentials listed the Boy Scout Handbook as the basis for the kits. Have the boys look them up in their books so they see how good a reference the Handbook is.

Typical additional items include a whistle, a plastic signal mirror (also used when Scouts brush their teeth ... hah!?), a large (bright) trash bag, a ferro rod, and some decent synthetic cord.

Teach the boys the characteristics of good/acceptable gear, and even provide sources for the gear, but let them purchase it themselves - where feasible. Making purchasing decisions is part of the Scouts learning/growth process.

Expect them to assemble their kits. Have inspections. Reward them for doing it- maybe with a special cobler party. Repeat this over several campout (more than 2).

Scouting is a process of learning and growth. Help them along that process, but you can't do it for them.

Ken