Being a bit of a beginner myself, I end up playing with people who are far superior to myself. I have a number of friends who are Masters and are willing to play games with me. Here's what they do:

They never give me anything in the way of an advantage because they feel I won't be given the same opportunity when I play in the real world of tournaments. They will, however, point out the mistake I've made after I move with some analysis thrown in for good measure. While I end up loosing the game, I win in the end by the amount of knowledge I acquire from the lesson learned during play. That's what it's all about, the lesson learned. If I am playing someone who is really new to the game, I will suggest they look at all the possible moves before making one, and then ask them to think about what the consequences are for that move (for both Black and White). I am lucky because my circle of chess friends are always willing to make a game both educational and fun at the same time. I think beginners should walk away from a game with something learned from that game.If each and every game teaches them something new, they won't become discouraged and give up before they have a chance to improve their skills. I have been lucky because in everything that I have been interested in there has been someone around to help me learn. I would never have become a professional musician if there were not other musicians around will to teach me as opposed to criticizing me.

When I play my kids, I play with a couple handicaps, like I only have 5 seconds to make a move. If they get a little frustrated, I sometimes offer to turn the board around and let them play my pieces. We often do chess puzzles too, like mating problems, or playing with only pawns.

 The method that I use for beginners is to play a game, and when they make a really bad move, make a few moves after that to show them that it is bad, then go back to the position where the bad move was made.  Then I give them the opportunity to make another move.  I play that until a real bad move occurs.  Then I play a few more moves to show why it is bad, then back up to that position again.  This way a person sees as many chess patterns as possible, good and bad, so that can recognize it.  Soon, they finish and lose a game and only blundered deeper into the game.  Then I try to see if the beginner can recreate the game.  If he can remember or spot the critical positions, then he his getting good chess pattern recognition.  Pretty soon, they are able to remember and recreate the whole game, and avoid the bad moves.