First problem: The little dears get distracted very easily and don't remember their positions. Second problem: They try to line up in straight lines (which never occur naturally) and when they realize the line is crooked, they spend the rest of the scene telling each other where to stand to straighten up the line.
A very wise director used to say that the best way to BLOCK for Children's Theater is to group the young children into "friends" or into lots of little groups of two or three each. That way they can work together in remembering where they should stand. Besides, small groups on stage look more natural. Straight lines never happen in real life. Just go out and watch random crowds standing about. They stand there in small groups of twos and threes.
When planting a flower bed, the most natural and elegant design plan is to plant like plants in groups of odd numbers, such as 3, 5, or 7. Well, 5 can be broken down into a group of 2 plus a group of 3. And 7 can be divided into two groups of 2 plus one group of 3. I always try to plan the blocking for large groups of children on the stage to follow this design plan. Just like planting a flower bed, I will assign actors into groups taking into consideration their heights, their lines, actions, costumes, and access to microphones. Obviously, I try to put the smallest children where they can be seen, but I don't want to block the taller children by always relegating them to the back row either. I always try to create movement in the scene or dance that will allow for flow to let more of the actors to be seen.
In Children's Theater we teach skills by playing acting games. Some of these exercises are designed to get the children to feel comfortable working on the stage and understanding how to create a good stage picture for the audience. Then when it comes time for blocking, the director won't feel like she is trying to herd cats!
ACTING EXERCISE: Have the children spread themselves out across the stage so that there is plenty of space between them. Then explain that they are going to create a stage picture. Play some music for a few measures and have the children move around the stage with great abandon expressing the mood of the music. When the music ends, they should freeze and pose themselves creating a good STAGE PICTURE. The people in the front should make themselves lower (crouch, sit, kneel, hands down). The people in the middle adjust so that they do not block shorter people behind them but remain taller than the people in front of them. And the people in back pose with arms stretched high, stand on tippy toes, or climb onto a stage block to become as tall as possible. Repeat several times using a variety of styes of music. ADDED CHALLENGE: Have the children always stay as close to their assigned "friends" as possible.