Thanks for all your input. It is great to read your ideas, and I loved your last quote NLBwell "let him still be a kid playing tennis instead of a tennis player who is a kid."
He is using a 26in racquet, and plays on full size courts (with mostly green dot balls). We are in NZ and most clubs haven't switched to small sized courts yet but I don't think he would have liked them much anyway. He loves to run, and adores chasing the ball across the large court.
His technique is getting better, but sometimes I think the wall probably hinders rather than helps this! In saying that, I find it very hard to stop him. He plays soccer at school during every break and loves this.
It is great to hear your feedback. One local tennis Dad told us recently that we should quit all his squads and do 3+ lessons a week as that would be better for him. I would be reluctant to do this as our son loves the squads and playing against other kids. It is hard when your son has an insatiable obsession though, I think he was born into the wrong family!!