After several emails, I finally got my 8GB SD card from Karuma. They were backordered when I ordered my unit. The first module they sent me got lost somewhere between Singapore and Texas. The second took so long that Karuma sent a third unit (tracking and signature required on the 3rd one). The third one arrived about 2 days after the 2nd. So, I got an extra! Cool.
Anyway- I popped the unit in and it seemed to be great. It appears that the SD card gets mounted as a folder under the internal 8GB. It's also available directly via /mnt/sdcard.
Well, a day or 2 after installing the card, all the apps that were stored on the TF card (internal memory or the SD, I'm really not sure) all failed. They were visible in the Manage Applications page, but the OS couldn't/wouldn't run them.
At this point, after all my playing and jacking around, the PB was freezing and FC a fair amount, so I decided to do a factory reset. The SD card was formatted, but the music that I had copied for the kids into the internal memory remained.
Anyway- the tablet seems to be running pretty smoothly and the kids are happy, so for now, my quest has been paused.
As for limiting the kids access to programs and settings they don't need to be on, I found a very nice app called Smart App Protector on Amazon (link) or Google Play (link).
Now- if someone could come up with a way to firewall Android without needing Superuser.apk installed on /system, I believe I would be happy.
PS- Kudos to Karuma tech support (especially Vanessa Sum)! Fast, courteous, prompt, responsive!