Just tonight I sat down with my 7 year old daughter and we wrote this snippet and had a lot of fun with it. (Just prints words backwards) We might add a bit to it to print a whole story backwards.
print "Type a word\n";
$word=<STDIN>;
chomp $word;
$backward=reverse ($word);
print $backward;
Anyhow, I think this is about the right speed for a kid. Language things are fun, and it was easy to explain that $word is a kind of noun, print a kind of verb, ; is like a period at the end of a sentance. The idea of algorithm will kick in as problem solving if we try to work with whole (English) sentences, since we will have to reverse the words first, then the letters in each word to keep the whole thing in order.
Plus you would be using Perl as a text processing language which it is real good at. I figure it should be possible to do simple s///'s at some point to screw up certain words.