Did you use training wheels when you learned to ride a bicycle? My dad was convinced they slowed down the learning process and taught bad habits, so he just held on to the back of the seat and ran down the street with me while I pedaled. Then he let go and I fell over. Rinse knees, repeat, until I caught on to the trick of keeping my balance.
At the Interbike show this weekend, Gyrobike demonstrated its battery-powered bicycle wheel, which has an internal flywheel. The gyroscopic effect of the spinning flywheel keeps the bike erect under even the wobbliest little kid, without training wheels. The speed of the gyroscope can be adjusted, to provide less and less stabilization over time until finally the student is balancing all by himself.
The wheel will be available in December via thegyrobike.com.