This problem is well characterized now.
If the XO has not been used for a couple of years, the Real Time Clock (RTC) battery has discharged (watch type battery on main board). It can be recharged by leaving the XO powered on for a couple of hours (even though there is no display). The time still remains at 0, which will prevent booting until a real time is set.
Unfortunately, a firmware bug in the original software prevents simple setting of the clock by software commands. The time must be set via a communication link to an internal serial port (3 volt version).
This requires a second computer (XO or PC) and an adapter with cables (usually a USB to serial adapter). If you have the original software (build 650) there is another bug that showed up as the date rolled over to 2011 : the keyboard will freeze. So, the the software must then be updated to the latest software (10.1.3) .
Various links to OLPC wiki references are on : http://xoshare.org/mi
You can borrow the adapter to make the repair or have the repair done at a repair center (low cost).
The Mid-Michigan XO Laptop Lending Library is one source for either: http://xoshare.org/mixo
The above contact will restore your confidence that your donation was a worthwhile contribution.
The repair process could be learning lesson for the recipient. Indeed, many of the nonprofits accepting XO's know of the issue and know how to make the repairs and therefore would welcome your donation as is.