It would probably be helpful if you could give us a price range you're willing/able to spend.
For an upgraded point-and-shoot digital, I liked my Canon Powershot (about $250). Photos can be taken on either auto settings or manual, which will introduce him to the fabulous world of f-stops, depth of fields, shutter speeds, and film speeds. If looking for something more upgrade than that but still reasonably priced (always relative in photography) and not something Annie Liebowitz would use, I've had good luck with my Canon Rebel ($500-900 range, depending on the specific model). This is an SLR, a "real" camera (which I define to non-photo geeks as having a lens that can be removed and changed with other lenses). You'll want to make sure you get a kit, which includes a basic lens, and not just the camera body because it'll cost more to get a lens separately.
You can also check out these Photo Group threads to see more suggestions:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=280&topic_id=37775&mesg_id=37775http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=280&topic_id=37775&mesg_id=37775http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=105x7622748Good luck--and I hope he knows what an awesome Mom he has when Christmas morning rolls around. :hi: