As a Cub Scout den leader, Cubmaster, Girl Scout leader, and now an assistant Scoutmaster for a few years, I seen a lot of compasses, taught compass skills to lots of Scouts, and done a buncht of research on budget compasses ...
I wholeheartedly recommend the Suunto M-3DL Leader compass (NOT the one with the global needle) AND you might want to get the Suunto Cordura Compass Case (a Ziploc bag will do fine though). A compass without a case can get pretty beat up. Also, emphasise that mosquito repellant with DEET will destroy a plastic compass!!
Suunto M-3DL Leader Compass (about $25):
http://www.forestry-suppliers.com/product_pages/View_Catalog_Page.asp?mi=1283
Suunto Cordura Case (about $10):
http://www.forestry-suppliers.com/product_pages/View_Catalog_Page.asp?mi=1285
This is a fantastic high quality compass for the price. No doubt the best buy out there right now. The Suunto M-2 is a good compass, but for just a few dollars more you get a much better compass.
If money is a concern OR you'll get real upset if it gets lost, then I'll recommend the Brunton Classic 9020G and you can just store it in a Ziploc snack bag. The only concern I have with the 9020G is that its symmetric shape adds a risk of pointing it in the wrong direction (ignoring the direction of travel arrow and using the back of the compass instead of the front).
Brunton 9020G Compass (about $12):
http://www.forestry-suppliers.com/product_pages/View_Catalog_Page.asp?mi=7091
No matter what other Scout leaders say (and they will) PLEASE don't buy a compass unless it has adjustable declination. Working with magnetic declination is a must know skill, especially as you get closer to the east/west costs, and the declination scales that many compasses have are confusing to our young Scouts.
Make sure the compass has a lanyard that allows it to hang from the neck to about the boy's mid-stomach. I use orange "Sportsman's Cord" that I found in Walmart's sporting goods section - comes on a small 2"x2" spool.
My favorite web site for learning compass skills is
http://www.compassdude.com .
My favorite book on the subject is The Essential Wilderness Navigator: How to Find Your Way in the Great Outdoors, Second Edition by David Seidman and Paul Cleveland:
http://www.amazon.com/Essential-Wil...bs_sr_2?ie=UTF8&s=books&qid=1203776042&sr=8-2