Not medical advice, but from what I've seen, there's nothing explicitly wrong with a toddler sleeping on memory foam or similar. They're past the risk of SIDS, and while some people may be better off sleeping on hard mattresses for back support, it's not true that it is strictly better - it depends on the person.
The main concern I'd have with memory foam is offgassing questionable organic compounds. Most of that offgassing happens early on (the first day or two if you air it out thoroughly), but some offgassing occurs all the time, and you do spend 1/3 of your life on your bed, potentially breathing in dangerous chemicals. I don't know enough to be an expert, and I use a memory foam mattress, so I certainly don't think it's that dangerous; but it's a risk some people prefer to avoid.
I would find out what your kid likes, and do that. If your kid likes the softer mattress, go for it. If not, stick with firmer. My oldest sleeps on a hardwood floor half the time because he really likes firm; my youngest just turned 1 and looks forward to sleeping on softer mattresses I'm fairly sure (given how much better he sleeps on our bed). Each kid is different.