I think it's hypocritical to make kids immune to violence in a game, only to then say that it's just a game when someone uses it as their excuse to harm others. It's a pick and choose mentality, and the devs that skirt it are just cowards (like Molyneux).
Movies geared toward adults depict acts of violence against kids all the time, the only difference is that it's interactive, but it's all just as fake (even faker if you remember that the kids in games are just 1s and 0s).
For me, the question is not only about being able to kill children as a choice in a game, but the absence of them altogether as well. Why did Liberty City have playgrounds, but no kids, for example.
It's the same as Nudity in games. Until the industry decides to grow up (like movies had to, and it took them about 40 or so years), most heroes will look like roid junkies, most women will be big breasted and crammed into the tightest possible but almost never sow their skin (even when sex is involved), and almost all children will be immortal.
...and I am thoo!
*get's off soap box*