My kids like
Scribble (free!)
Airport Mania
Penguin Whacker
Checkers
Freshwater Aquarium
Mad Libs
Infinite Maze
Pegs (it's like that Cracker Barrel peg game)
Here's a site that lists good apps for kids
I've found some good ones from her reviews
http://www.iphone4kids.net
I just saw a post that said there was a Toy Story read along that was free for the ipad too at one point. Can just search for it I'm sure