My advice is possibly going to be against the grain a bit. Before I begin, I would like to preface that I've never fished in Michigan though, so I may be out of my wheelhouse a touch.

I'd get the minimum shit you need to be warm and have fun. Some specific recommendations would be:

• Good clothes for sitting still in freezing temps, on a frozen surface.
• Decent tent, decent little heater.
• Get a nicer hand auger. It's way lighter, and requires nothing but your arms. I've drilled through nearly 16" with mine, and it takes maybe 45 seconds. I've also never ran out or forgot my fuel, or had starter problems with it.
• For-go the flasher for this year. Sure it'll help put you on fish, but you're going out with your boy. You're not going to be post holing all over the place, if I had to guess. You'll want to get out, set up shop, and have fun. Just do some recon on some fish reports, and go where you see other tents.
• Tip ups are nice, but again, I think your boy will have a LOT more fun jigging rods and just hanging out in the tent with you, looking down the hole.
• Definitely get a jetsled to help tow all your crap out.
• Two comfy chairs, that you can sit up on. I have two camp chairs, that I hate. It's incredibly uncomfortable to look down the hole, which is my favorite part of ice fishing.
• Few buckets are nice. I carry a ton of shit out in them, and pack fish out in them as well.
• Rods and rod holders.
• Tackle

I think with the above, you'd be ready to go for your first season. If the kid loves it, or you find yourself going a lot more often, then I'd pony down for the power-auger and flasher. But, last thing you want at the end of the season is big dent in the wallet for some hobby your boy hated.

Christmas wise, I'd get him a cheap rod, holder, and his own tackle box with lures/jigs/etc. Worst case, you are out a rod and the holder. Assuming he'll like fishing of some kind, the tackle box will be great. I still have my first one, at my parents house.

I'd also look into possibly some heavy duty boots, gloves, etc. The biggest way I see your boy hating this whole thing, is if he's cold. No one likes to be cold.

Also- I'd like to suggest finding a local ice fishing group on Facebook or something. I have joined one, and it's great. You get ice reports, fishing reports, guys selling gear, tips, stories, and everything else you could possibly want to know about. It's also nice to have a place to send out a "mayday" if you need a hand or left some shit at the parking lot or whatever.