A bucket! One of my favorite campfire sketches is "There's a hole in the bucket". Participants can really ham it up.
Laura lots of great guitar resources. For a wide variety of 60's 70's, folk and folkish (John Denver, Dan Fogelberg, Eagles) try: www.olga.net You might also look for OAK publications which specializes in traditional, bluegrass and folk. I also like to hit the thrift stores for discarded school music books and sheet music.
Something you might consider is the ukelele. Seriously! I found that if I bring out the uke the kids really are curious. It's easy to learn t