The GSm is nice, but c'mon guys, compare
closely the body dimensions: it is
not that small. So what you're really getting is shorter scale and tighter frets to ease fingering a bit, but body size ain't much better than an OM, OOO, or GA sized guitar. Depends on the size of the kid, really.
Another drawback to the GSm IMHO is cost: this is a fairly "serious" guitar in terms of cost for a kid(s) who may have no interest after the novelty has worn off, not to mention are you
truly comfortable with that nice GSm left precariously leaning against the dining room table or TV stand as they switch over to a new task in "kid time?"
IMHO, nylons are not a good starting point for small hands, Dave. Necks are normally quite thick, the fingerboard is flat, typically with little to no radius, and almost always a 2" (or close to it) wide nut: in sum not very conducive to a novice's fingering.
The Baby T is fine for a smaller kid, can be setup to play with excellent action, and when bought used can be had for a song. But it is
quickly outgrown. Fine if you're ok with keeping it later as a sittin-'round guitar, or simply selling it when the time comes.
My suggestion is it depends on the size of the kid and his/her hands, then decide on either a Baby T if on the smaller side, or look for a used BigBaby or GC-sized (again, like a OOO, OO, or OM) guitar if a bigger kid. There are simply lots of inexpensive decent used and new Taks, Seagulls, Yammies, Alvs, etc. out there. Inexpensive guitars today sound and play worlds better than when I was a kid! Avoid the dred bods and have it setup if need be ...decent tone and play on the cheap.
BTW, to the OP, good for you, man! Regardless of how it turns out, kudos to you for sharing the love of music!!
Edward