I have a kid and love kids so their stares don't bother me in the least. I pass "in passing" but if you take much of a second look you can read me without a problem and it is funny how kids sometimes just zero in on me while their parents are either trying not to stare or are completely oblivious, but I never take it as anything more than curiosity. I just smile and say hi. Depending on the parent or the situation, if its a little girl I'll give her a little compliment on her jewelry or shoes or whatever, but sometimes not if the parent seems uncomfortable. In my experience the parents are usually mortified that their kid is staring.
Overall though I guess I try to always be friendly because most kids (and adults for that matter) just don't have a lot of experience with trans people, and even if it's just a minor thing, I'd like they to go away thinking "hey that person was friendly and kind and just a 'regular' person living her life".
I had this experience just the other involving a little bit older kids: I'm pretty much out and have a young son. My wife and I took him to the park the other day. There was this group of 12-13 year boys there (the worst age) being loud and swearing and shoving each other. I went to go push my son on the swing and while I was doing that my wife went over to talk to these kids to tell them to tone it down. She's a teacher and deals with this stuff all the time. She asked them to please stop with the swearing etc and then was just talking to them about whatever dumb stuff they were arguing about (girls, who's a nerd, etc). I didn't hear any of this but she told me after, btw. So then they started asking about me and if I was a man. She said I was transgendered and that basically meant I was a woman. They were like "whoa I've heard of that but I didn't know there were people like that around here!" And my wife just told them that transgender people are just regular people like everybody else and they were all "Oh yeah, we get that. It's cool, we have no problem with that" or whatever. So anyway, I just thought it was interesting and probably was a positive thing for them to have that conversation in terms of trans visibility/acceptance etc. Of course it doesn't mean their not going to turn around and be little jerks or whatever, but in the overall scheme of things hopefully it made them think about it a little.