Yes, Shih Tzu is a good pet for young children if it is shown that the family members are the pack leaders. This will prevent the dog from developing the small dog syndrome. Personally, I would prefer a beagle as a pet for children since it is excellent with children.
Toy poodles are good dogs for young children. They have good temperaments and they are hypoallergenic so your kids shouldn't be allergic to them. They do require a moderate amount of exercising and grooming though.