I'm still unsure why everyone is suggesting an N7 because they had success with a Nook or some other tablet. I don't think people here understand what the Nabi 2 is. It's a full Android tablet that uses the same processor that the N7 uses. It's the same price. It has the following pluses over the N7:
1) Included very rugged case
2) Included kid interface with parental controls
3) Included 30+ books, educational curriculum apps that teach multiple subjects (English, Math, Science, Social Studies) at levels from Kindergarten through fifth grade)
4) MicroSD card slot for storing up to 32GB of photos, movies, audiobooks, music, videos, (and apps if you root)
5) miniHDMI port
6) Excellent customer support (in my experience)
The N7 has the following pluses over the Nabi:
1) Gets latest updates from Google
2) Jellybean (vs. Nabi's ICS)
3) Native support for Google Apps includeing Google Play (without rooting you can get all Google apps working on the Nabi except for Google Play. Google Play will work to browse apps, download movies and books, but not update/install apps. However, this limitation of course goes away if you root the Nabi)
4) Better screen resolution (1280x800 vs. 1024 x 600)
5) GPS
6) More built-in (non-external) storage space (16GB vs. 8GB) (for same $200 price)
7) Slightly longer battery life (although after some updates, Nabi's battery life went from about 5hrs up to 7-8hrs)
These are the basic differences between the two. Rooted, the Nabi, is more competative with the N7, at least as far as software. Hardwarewise it's kind of a wash as both of things the other doesn't. I think the problem is that most of the respondents have never used a Nabi and so believe that because it's geared towards kids, it must be just a toy. This might have been true about the first Nabi that came out last year, or other kids tablets that try to copy it but without the horsepower of a Tegra 3, but it deserves serious consideration in my opinion...