RROD is effectively no longer an issue with the newer model 360, also known as the 360 S. In
this picture, the newer model is the one on the right. There is also a third, more recent revision called the
Xbox 360 E. I know essentially nothing about that one.
Looking for something Xbox-related to get him for about $20? How about an Xbox gift card? He can use it to buy games and DLC from the Xbox Live Marketplace.
The Xbox One is basically Microsoft's next generation console; it's got a Blu-ray drive, supports more graphics-intensive games than the 360, and has integrated TV and social functionality. The 360, however, is a better consumer of digital video, music and such, as it can be easily streamed from a Windows PC or a DLNA server on your network. The Xbox One isn't capable of much of this. Yet, anyway.
I imagine there won't be many more games made for the 360 after the end of next year.