We decided to get R a balance bike for his 2nd birthday because he didn't have a trike and it didn't seem worth getting it.
After much investigation, the PIL got him the smallest Puky available - the tiny one with solid tyres. It's fabulous - light enough to balance on the top of the buggy, so far indestructable and it's no where near too small at 3.5 years old.
R didn't really get the idea of balancing until he was about 2.5 years (he's not the most coordinated/brave of children and he's small) but by 3 he was well and truly off and he can balance and swoop all over the place in it.
The reason we originally liked it over a normal bike is that we hoped to avoid stabilizers in the future and R would have struggled to coordinate pedalling at 2.
But now we've found another benefit - if a child is moving on a normal bike and they have their feet on the pedals, they'll keep moving until they brake or hit something. On a balance bike, as soon as the feet are down, they stop. This is a complete bonus when they are learning to steer - or in R's case when they can steer perfectly well but get distracted and look in the other direction...
R can go faster and more fluidly than the same sized child on a same sized bike with stabilizers, it's really fun watching him now!