Think hard about that engraving. If you ever sell it you will hurt the resale price. And if the iPad has to be replace for service under warranty (I hope not) you would have to send it in, you couldn't do so at a local store.
Here is a suggestion for you: get a nice leather case for it instead and have it embossed. It would also add a level of surprise since they would not be expecting it.
I'm so happy that at least now you know they'll appreciate such a thoughtful gift! So your idea has not soured. Instead, now they get to have time to anticipate some of the things they might be able to do with the ipad once they have it! And the excitement can build for them!
Still, I only have one thing to reluctantly point out. If they are Seniors you might want to be sure that they'll be able to handle the size of the mini vs. the regular ipad given aging vision.
And regarding the Apple ID where they have to have an email adress, that's more commom than not these days. We've had to change our user name on many things (cable, phone, etc.) to our email address as our ID. So set them up with their own gmail or yahoo or aol or whatever is available to you (you can do it on the ipad) so you'll feel less under Apple's control as you were concerned about last night.
I love the thought of you engraving it, but I don't know about the engraving and resale or having it fixed, but I think Deggie has a good idea to make it more personal if you choose that route.
They'll love your gift and your help setting it up!