I'm probably going to be the odd one in this post, but I don't think the choice should be up to anyone but the child. What do they want to shoot?
When I was there age, I wanted to shoot traditional bows. I knew that's all I was ever going to enjoy shooting. When my dad gave me a bow for my birthday, it was a compound. I believe his explaination was that compounds were the way to go, and that no "sane" person would settle for traditional tackle in this day and age. I don't even want to know how many kids are turned away from trad just because there family/friends shoot compounds and believe that same idea.
Don't get me wrong, I still shot it since it was a great gift/gesture on my father's part. But it just wasn't me. Explain both to your kids. Tell them that they'll be more accurate with the compound, and that they'll be more satisfied with the recurve. Go over the pros and cons of both and let them choose which one they really want.
If they're shooting the bow that makes them happy, then I'm sure archery/bowhunting will become a much bigger part of they're lives...