M.S.
Loveland (the ski area, not the town). My favorite part about them is that the lodge at Loveland Valley (down from the tunnel - the Basin is on the tunnel) is small and very friendly. and parking is closer from the far end of the lot than how far you walk from the bus stop to the lodge at the big resorts (i.e., Winter Park or anything in Summit County).
Kids 5 and under are free. their lessons are the cheapest of those w/in an hour or so of denver when I last looked. and we have yet to find anyone else that can come close on total price for lift tickets - not even Eldora. they have coupons in the entertainment book.
we taught our kids ourselves but I've heard good things about Loveland's ski school.
we rented the kids' equipment from them a couple times too and it wasn't too bad on cost - only a few bucks more than down the hill.
If you're near I-70 and Kipling, Larson's is a great place to rent and super cheap (Last year it was $25 for 2 sets of kids skis/boot and one helmet - we owned one helmet). Their hours are weird so you need to rent the night before.
have fun!