As far as a good youth bow there are three sponsors here that I'm aware of that build "custom crafted youthbows" that are very affordalble.
St. Joe River Bows
Maddog Archery
Montana bows
I believe one of these sponsors even has an upgrade program, which is really nice option if the little one grows and continues in archery.
I give the folks credit that offer youth bows and the price they do, as I've talked to bowyers who said they have just as much time building/finishing a youth bow as a full size bow. Other than the few pennies saved on material, that is reality.