$3400 is only A LOT of money in a poor rural area if it is spent on local, non-traded goods: the consumption value of an iPad 2 is roughly the same in rural China and in NYC. If anything, it may be far lower in the poorer country due to lack of complementing infrastructure.
It actually makes me think that the iPad 2 part of the story may be entirely fictional: perhaps the kid made it up in order to seek publicity and attention.