He could buy them some games, or accessories (extra controllers, kinect, etc)- or gift cards so they can buy games later as they're released. THEN, of course, also coats. One thing my mother used to do for me when I was little was to take me to the dollar store around Christmas time. There, we'd buy a basket/gift box of some type and some small toys to go inside - plus some school/art supplies like crayons. Then she'd take me round to the donation center and have me register the basket as my gift to other people. As I got older I started contributing some of my own money; now I participate in secret santa and still go to the dollar store. I make up two baskets, one for kids and one for adults (with things like batteries, winter gloves, etc). it sounds like these kids would be a good candidate to start that new tradition with.
As for the people with high end taste and low end budget, oh PLEASE.
Although there is something to the Vimes Theory of Economics... Rich people stay rich because they can afford to buy higher quality items. (He used boots as an example). That theory only holds if you disregard those who must have the latest fashion. Those who buy higher priced/higher quality items intending to use it until it dies will get more 'bang for their buck.'