FREE ONLINE CHILDRENS BOOKS
http://www.wegivebooks.org/ (Run by the Pearson Foundation. This site is my favorite online childrens book site.)
http://en.childrenslibrary.org/ (old/rare childrens books)
READING REWARDS PROGRAMS
http://scratch.mit.edu/ A computer programming language for kids. If your child is able to read and use a computer then they can teach themselves to program and create animations simply by playing with this website.