Try an FJ
Club FJ's are cheap and plentiful. Many college and high school programs use them and are popular among sailing camps, too. I learned on these when I was a young kid and bought one later in life (under $500 with trailer) when I sailed on lakes in Colorado. I've seen these show up in GSA auctions (Naval Academy uses them) as well as on the old Team Vanguard website for used boat listings. The boats have positive floatation, can be sailed easily with 2 youngsters or even two adults but aren't as powered up as a 420. If you have a local college that has a sailing team, find out when they are upgrading their boats and offer to buy the old boats. THey will be worn and tired, but they will function as a good learning experience for the kids.