Well....(assuming you mean an Xbox 360),
If the grandson just needs a standard system and probably won't be downloading a lot of stuff from the internet or playing old original Xbox games, then the Arcade package for $199 is the way to go:
Amazon.com: Xbox 360 Arcade Console with Bonus Game: Video Games
If the grandson does quite a bit of online gaming and wants to use the 360 as more than a gaming system with downloading of multiple files and Xbox Live Arcade games (small downloadable games that are smaller but cheaper than disc based games), then the Pro Package is the way to go:
Amazon.com: Xbox 360 Pro Console 60GB with 2 Bonus Games: Video Games
Finally, if the grandson is a hardcore gamer who demands high performance and storage space (and your really willing to splurge for them), then the Elite Console is the way to go.
Amazon.com: Xbox 360 Elite Console 120GB with 2 Bonus Games: Video Games
I'd recommend the Pro Package. It's the best value for the price and has a decent sized hard drive to accommodate numerous downloadable games/movies/songs etc. If he's really young and/or will not be doing a lot of online gaming or downloading, then the cheaper Arcade Package will like suffice. Going for the Elite is a little overboard in my opinion, although it may be nice since they are discontinuing it soon and he can brag that he got "one of the last Elites." I don't know if that makes it worth the $399 price tag though..