I have a Nikon D70 with 18-70 lens. I am on a two kid budget. Should I spend the money on a new lens (70-300) or get a flash (SB-800) other than the built-in one?

I take mostly family and car pictures. I would like to get into action and outdoor. I guess i really want to know if I can get by with the built-in flash if I were to go with a bigger lens.

You can always zoom with your feet. The flash will be useful both indoors (bounce) and out (fill).

70mm is not enough for sports or racing shots.

with a 1.4x teleconvertor. My big lens to get right now is a Nikon 200-400 f/4 but that won't be for a long while I'm afraid. If you're going to be shooting a lot of indoor stuff, then get the flash, otherwise if action/outdoors then you'll want a longer lens.

For sports and outdoor work, a flash won't be terribly helpful. For family pictures and stuff, the in camera flash will suffice for fill. I'd probably steer him to some sort of tele zoom. Ultimate his budget will probably dictate what is viable and what isn't.