My kids' high school ( http://knoxcountystemac.knoxschools.org/ ) has done this as well. I'm still not sure how I feel about it. On the one hand, the kids aren't hauling 30 pounds of books to and from school everyday, school lockers are pretty much superfluous, and the iPad is a great tool. On the other hand, it's very hard for me as their parent to tell (at a glance) whether or not the kids are actually doing school…
Can you not restrict them so they can't install games etc? [EDIT] The iPads, not the kids!
You can restrict installing apps, uninstalling apps, using the camera, loading the App Store, talking with Siri, altering settings, etc. See this list for some of the things you can do:
http://help.apple.com/configurator/mac/1.2/#cadbf9e41d
Yet more: