I give 1.00 for each tooth. you don't want to make it too high or they will figure out ways to lose their teeth for money. Even at 1.00 you could get that sort of response and don't set it too high because they may lose 2-3 teeth real close together.
My kids never complained that it was too cheap even though some of their friends get 5 or 10.00 per tooth which I think is too much. They also knew that the tooth fairy really wasn't real just as they know Santa isn't real. They enjoy the stories but we just never got it started that they would believe Santa or the tooth fairy were real. My belief is.. you teach your kids not to lie but give the wrong message when you lie about Santa or the tooth fairy but we aren't so against it that they can't enjoy the fairy tale stories to read about or watch movies. They love watching the Santa Claus movies with Tim Allen that portray the Santa story that you really could believe it's real but there are so many movies that are like that and the kids know that a lot of things they see on tv aren't real and that is what makes it so fun to watch them. I also feel like why should Santa or the tooth fairy get the credit for the gifts that are given.
It also makes it a lot easier if it was never started to begin with so when the child is in school and finds out that these fairytales aren't real then their little hearts aren't crushed and devastated. I do tell my kids not to tell the other kids that they aren't real as they will find out on their own one day but if a kid asks them if they think it is real they can tell the truth and not lie to them.
As for the tooth fairy, it makes it easier when they know who it really comes from because there are always those times you forget. my kids still like to put the tooth under their pillow and we try to remember to put the money there but if we forget they aren't too worried about it as they know they will get it.