Tournaments are always more popular, because everybody has the same at risk.
I'd do a $10 S&G, and even give everybody two "rebuy chips" that they can use if they go bust. No cost for the rebuy, just two more free chances.
You don't even have to run it like a real tournament, just set up the blinds and let them play. Increase them when you feel like it. If they're new, they'll go broke soon enough anyway. If it's getting long, then just say, "Okay, now we're going to double the blinds every ten minutes from here 'til the end!"
Or if you want more structure, play around with http://blindvalet.com/