Well, I'm sure many would disagree, but I have bought three of these combos for family who were just starting. The Cabela's Cahill combo, which is on sale right now for $39.99 is the best setup out there for the money. Most of you know that I've been doing this fly fishing thing for a lot of years, so I wouldn't intentionally lead you astray. The question was what do we think is the best "starter" outfit. The challenge exists that the person we supply with the outfit just may not pursue it after a few times out, so why spend a lot only to find it was a waste of time and money.
The Cahill outfit has a functional reel and a pretty decent rod. For 40 bucks plus shipping you can't really go wrong. I actually have one of these as an emergency backup rod as I truly like the action of this rod.
Here is the link: Cabela's Cahill Fly Rod and Reel Outfit : Cabela's