...today's world IS over surpervised, over scheduled, and over protected. As a result, the kids often feel that they can't do anything on their own
Actually, kids DO all manner of non-PC things... in video games. It's not just ants they burn with a magnifying glass in the sun, it's aunts (and uncles and innocent bystanders) using a flamethrower. Of course, this innocent play in the virtual world does not carry with it any significant consequences like trips to the hospital or scars or having to ride your bicycle with the handlebars twisted from a crash or even getting grounded (much less spanked) - so the lessons learned are far different.
I guess we'd better get used to the notion of operating in a virtual world, though. Some rock/pop bands are starting to do "live" concerts in cyberspace. I wonder how long it'll be before someone opens a "Virtual Acoustic Folk Club" in Second Life?