IMHO, the language choice depends on the age of the kids and on your intention. Shall they lose their fear of computers, shall they get a better understanding of computers, shall they learn something about algorithms, shall they get prepared for a computer science course...?
To me, both Java and VB are not really good for beginners because they burry the important concepts under too much syntax and tools. Easy things should be easy. Logo is still one of the best choices IMHO for a beginner computer language. Knowing half a dozen words, you can already write impressive graphical programs. Logo is also a Lisp dialect and has quite powerful symbolic processing capabilities. Very useful for a adventures
For older students, I'd even suggest Scheme (another Lisp dialect) as a language probably nobody knows (so same chances for everybody) and which can be used to teach basic algorithms as well as high level functional programming (if you want/must do).
The next best choice might be Ruby, a fine scripting language that combines the best of Perl, Smalltalk and a dozen of other languages. Again strong text processing capabilities, purely OO (in constract to Java) and build-in network stuff. Very useful for adventures or muds. Or you might head for Python (a language not as clean as Ruby and therefore not my favorite) for which there's already a mud available which is called POO.
There's a fine Logo interpreter available for Java. Scheme also runs on Java as does Python. There's also JRuby but I've no idea whether the system is already usable. Of course, there're also native versions of all these languages.
Still, using Java as a base has advantages. You can use Java's libraries and slowly make the transation to a (boring
lower level, Algol-like imperative language with "some acceptance" in the industry.
Regarding text adventures as example: I used to teach Java (and Smalltalk) courses to programmers and for one course, I tried to create a simple text adventure with the class. That was tougher than expected because most of the guys never played them and had difficulties in understanding the OO model of rooms, exits, items etc. I had more success in letting them extend my simple Logo interpreter I prepared for the course... But I had fun preparing the examples and they had fun to solve the mini puzzle. So after the hard work, it was kind of rewarding.
Anyhow, creating a text adventure or mud in Java would be fun. I never did the latter and actually and would think that you'd probably need to create a tiny in-game mud language (POO uses a restricted Python here but as Java has no eval, you'd need something own here) which makes the project more difficult and OTOH more interesting (at least for me because computer languages are my hobby
As a last comment, if you need to choose between Java and VB, choose Java but use a good teaching IDE like BlueJ (perhaps also choose not use use Windows as OS and go for Knoppix as an instant Linux distribution as this might help students to learn that Microsoft is just one choice)