I think this is a great topic.
My son (currently 5, but I bought him the Bachman E-Z Track N-Scale starter layout set when he was 4) doesn't really know anything but N-Scale. I taught him to be gentle with the cars/diesels and to not run the throttle all the way up. He does well and even enjoys switching on his small track set-up.
I'd like to get going on my permanent layout in the basement so he and my daughter (

can get some construction assignments of there own (maybe plaster casting and/or scenery painting). Benchwork is 2/3 of the way there, getting closer to that moment. I'm looking forward to getting them involved.
Mike