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Affordable mountain bike for a 12 year old that will keep him in love with the sport?

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We just bought bikes off the craigslist for our kid and it was hit or missed. I think modern kid bike features that would make biking more enjoyable, such as a lightweight frame and a lower centre of gravity / more wheel spacing, are often missed. I have read that having a heavy bike is a real bummer when you weigh less than 100 lbs, as the bike-to-human weight ratio is so poor.

So, that said, in the $500 range, any recommendations for:

A 5-foot tall, average weight, reasonably fit kid,

I 'm speaking of mountain bike wheels (although we're not really going to fly down real mountain trails, more for urban use.)

No need for insane gear numbers, maybe 8 speeds?

Light and — most importantly — fun!

I know it's not much for $500, but we don't want to waste $1000 or $2000 (gulp) before the kid stops growing too quickly. We are looking for a bike that will last for three years or so.

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