I look for the tiniest spinning reels I can find. Dick's, Walmart, Academy usually have combo ultra-light rod/reel sets for $20-30 that work great and have dinky reels. I just bought a Shakespeare set that breaks down to two 2.5 ft. sections at Dicks. Don't get caught up in how many ball bearings the reel has. My Mitchell ultra-light reels have zero ball bearings and work beautifully. I have a 6 section pack rod that doubles as a fly/spinning rod....somewhat useful...rarely used. Those little Snoopy or Spiderman rods are actually quite good! I think Shakespeare makes a little boat or dock rod (spring steel, looks like a cell antenna), about 1.5ft long, that would be great with a better reel. Plastic reels, I don't like.

Addendum....I'm a cheap skate when it comes to fishing. A $600 fly system catches no better fish than a $20 starter kit or cobbled together hand line, in the right hands. Get something with usable action, some good line (4 lb. for me!) mix and match reels/rods, and learn about what you are trying to catch. And bring the kids!