mak-
The Panasonic LS-2 is a good camera, for an entry level camera. It is capable of good images as long as you respect its limitations, especially the flash range limitations. You know the demands that will be placed on the camera better than I do. Read over the review and decide.
http://www.steves-digicams.com/2006_reviews/ls2.html
55+years ago I was the School photographer when I was a teenager. From my personal experiences back then, I know that I would be pressing a camera such as the Panasonic LS-2 quite hard taking the photos that I used to have to take back then. However, I am sure times have changed a lot. You are in the best position to make that decision.
MT