A starter set is a good beginning point in the hobby. First I would have to ask before any suggestions would be whether you are interested in: Vintage Steam Locomotives or Modern Diesel? Passenger or Freight Train?
If you are planning on just trains for Christmas, then a Polar Express set would be the ticket, if/when you decide to keep the train set up year round, a freight set has more play value. The Berkshire type locomotive in the Polar Expresss set was also used in freight sets, so adding some freight cars as time goes by gives you an easy expansion to your railroad empire.
Where to buy? Not knowing your location, here are a few retail options. They will give you an idea of price and what is available. Check them all out, also look locally to see if there is a local hobby shop or retailer that sells trains. You might also want to do an online search for a retailer near you.