Once you have the iPad's parental controls enabled, you will be able to set different restrictions and even restrict some of the default applications that came with the iPad. This includes the Safari browser, YouTube and iTunes, so you can restrict your child's ability to view websites, watch videos and purchase music from their iPad.
You can also turn off the ability to install apps. You can still get apps on the iPad by installing them to iTunes and syncing them to the iPad, which will allow you to have complete control over which apps are on the iPad.
If you don't need that much control, you can set a ratings restriction for what type of apps can be installed on the iPad. (Find out more about the different iPad app ratings.)
Another good thing to turn off is in-app purchases. Many free apps allow in-app purchases, which is how they make their money. This type of monetization can be seen in apps like Pocket Legends, which is a great iPad app, but parents must be aware that it allows for the purchase of in-game money.