Blender is the most powerful free modelling and animation application (with 3dgs support via plug-in)
Wings3d is free and easy to learn
MED is already installed and not that bad as most user say (often such users did not use MED at all nor did read the manual)

FragMotion is a very cheap animation software with 3dgs support

When it comes to the big ones:
For commercial use of the most powerful tools (modelling, animation and rendering) there is nothing more affordable than Lightwave (500 for side-grade, 700 full), Max and Maya are too expensive. Modo could become a good solution in the future with new capabilities for rendering and animating.

Big useful tools (200-500):
ZBrush for creating normal-maps and painting in 3d
DeepPaint3d or BodyPaint3d for painting in 3d

What will be best to teach?
That depends. When you have the time then you could teach Blender. If your customers and teachers do not have the passion and persistence then switch to Wings3d or MED.

Make a 2 minute free demo.

the big issue Is the modeling tool used in the class. availability, cost, compatability ( import/export) and your( your teachers) ability to show how easy it is to learn in a very short period of time.

most users are impatiant and don't want to spend hours ( days) figuring out how to make a simple model in a unfamilair application and will generaly go back to an application they are already use to ( one of the main reaspons I think MED is so overlooked as the lack of documentation into just how to use it)

its not easy to take lessons learned from one application and try to apply them to another tool..if the tool doesn't nativly work with the desired model format a user needs the application will look less agreeable to the user
(import/export between various applications can get dodgy)