(Note that I'm not blaming the victim here, just pointing out a fact people tend to forget)
This is why you never, ever talk to the police without a lawyer. A good lawyer would have asserted his client's full rights out of the bat, suggested him what to say and how to say it, and probably threatened to sue for harassment if they wanted to confiscate the iPad. At that point most policemen would have given up as "not worth the hassle".
Instead, they just saw a boy playing with toys, and made him frame himself. He completely missed the big picture here; when asked if he thought a crime had been committed, he basically said "it's for the hacker to define that" -- "crimes" are defined by criminals now? It's for the *police* to decide, and they did indeed decide, probably because they saw the boy being somehow ambivalent about it ("when in doubt, charge" is a common police attitude in many parts of the world). Again, a good lawyer would have stopped him from saying anything -- you don't debate the fine points of the law while under official questioning, because it doesn't matter and it can only hurt your case. Let the lawyers debate it for you, they'll do it better than you ever could.
"Anything you say can be used against you" is not really understood by the common folk until they have this sort of experience. It should be taught in school.