On the subject of kid friendly games this one is actually really good:
It was made by one guy alone which makes it all the more impressive and it has a certain cartoon/anime quality that you either love or hate. It's really cute and I'm having fun with it and I'm (supposed to be) a grown up.
It has level ups, combat, some platforming, items, quests and clever dialogue with the cutest sidekick (I mean it Fidget is simply adorable).
The quality of the game is outstanding and it is absolutely gorgeous.
I just thought I'd point it out because it's easy to miss. As far as I'm concerned the only drawback is that it's in English only otherwise I would get it for my cousin's kids.
There is a more in depth video about the game itself:
It was available as one of the games for Xbox live gold so I've played it some though like many games not as much as i'd like. But from what I've played of it, it seemed fun.