I don't see how targeting children with an adfree product with the stated intention of turning them into lifetime Bing users (with ads) is improving on Google's creepiness.
Their goal is to "cut off the air supply" to Google… just like Google's goal with ChromeOS (and the $249 Chromebooks) is to cut off Microsoft/Apple's profits.
As consumers, sometimes we get a nice deal out of the infighting.
I'm not saying that Microsoft is motivated purely by altruism - however, Microsoft could probably offer everybody (not just students) ad free search and still be massively profitable and there's not a damn thing Google can do about it.
Privacy issues are a potential long term limitation on Google's business model and kids grow up fast.