Joe Danger is a good game for kids, I think, especially as smaller children often don't pay attention to things like rules. I used to play my niece in Gran Turismo, where we'd get Mini Coopers and just drive around slamming each other into walls.

Hamster Ball? :D

BK: Nuts & Bolts and Viva Pinata on 360.

LBP on PS3.

Little big planet, hands down.

My 7 year old nephew loves Mortal Kombat.

Rayman Origins!? That game will make you throw your controller to the wall lol

I tend to be the 'fun uncle' to both bio and adopted family. So I get to entertain with kids. We all have a pretty good time. These are the ones that they tend to enjoy, request, and play the most. I put stars on my top 3:

Happy Action Theater and Kinect Party, a bunch fun of 'mini game experiences' ***best for kids***
Kinect Fun Labs - many things, most are free, Bobbleheads, Build a Buddy, Air Band, Googly Eyes, and especially, "I am Super" **super great for kids**
Kinectimals, now with Bears!
Kinect Disneyland Adventures
Sesame Street Kinect
Fruit Ninja Kinect
Nat Geo (National Geographic Kinect.)
Kinect Star Wars - kids LOVED it. *great for kids*
Lego games - Harry Potter, Star Wars, etc.

If they are a little bit older they seem to love, Fable II, Plants vs Zombies, and Viva Pinata

And the Mars Rover Landing Kinect (part of Kinect Fun Labs) game is still cool if you can get it.

Edit added a few Fun Labs Games, and connect that Mars Rover Landing was part of it.

i played just the biginning of it, the style seems a lot like what kids would love and the type of game a kids would enjoy as well. i cant comment on the difficulty level though

^this

i dont care how much you detest xbox and kinect yourself if you have kids its worth getting.  buy it used so you can keep your  sony were #1 position and not add to vgchartz numbers.  lol

LBP
Sly collection + Thieves
Trials
Fallout 3
Rayman
LEGO games

gta 4