Hello,
I would recommend a twin bed. I think toddler beds tend to be a waste of money...they can only use them for a few years and the nice ones can be costly. Once they've outgrown them, then you have to buy another bed. My son was only 20 months when we switched him from a crib to his big boy bed and he adjusted well. We put up a side rail and we actually didn't even use it very long. If you are worried about a twin bed being too high/tall, get one from IKEA. They tend to be lower. Whatever you do, don't buy their mid-sized kids bed (it is bigger than a toddler bed but smaller than a twin bed)--you will have to buy a specific mattress (as the crib mattress is too small) and the only sheets that fit it are from IKEA. My girlfriend bought one and was kicking herself.
Now that my son is almost five, we have switched out his baby changing table, dresser, etc. and have purchased furniture to match the twin bed. Good luck!
K.