C.F.
I agree that giving the kids gifts might make parents feel the pressure to reciprocate, and you don't know their situations, especially in difficult economic times. If I were you, I would just get some cute holiday cards and include a sincere message to each kid. Let them know what you think makes them special and how much you appreciate having them in your day care. I think that the parents would appreciate something personal like this more than gifts. You are also under no obligation to get anything for the parents. You are providing a service for them, and the help you give them is surely gift enough.
Happy Holidays!