Whilst definitely sharing the concerns that a low hour pilot taking children on fun flights may raise, I also like the idea that there is some meaning and value to having the licence itself. By that I mean, there's nothing wrong with a PPL holder taking passengers on scenic flights in my opinion. That's even the whole idea or else most of us would ever be flying alone, wouldn't we? Whether the pilot has the ability to fly consistently to the standard of their licence is obviously a totally different story and probably the only that matters. On a side note I remember the first flights taking my loved ones onboard as being more on edge than flying with the ATO. It was one of those experiences that eventually expands your comfort zone (and which I highly recommend) but where you also really realise that the passengers place this huge trust in you. That's the kind of awareness (or maturity?) I'd be looking for in the pilot, whether they have an ATPL or just a RPL.
Ultimately: if something doesn't feel right, don't do it.