When my kids were growing up, we use to bicycle everywhere. In WA State, the roads were very hilly. We had a tandem that was modified to fit my daughter.
We bicycled to Church the day Mount St. Helens blew. We were basically the only ones to show up. I guess others had more sense.
We use to bicycle to my son's and daughter's soccer games and then they played in them. I was a little worried that they might get to hate bicycling, but as my son's blog showed and the above video (ripped off from the blog) he is carrying on the tradition with his kids. When my daughter visits, she brings the kids' bikes and they appear to enjoy biking.
The other day, I saw a young child in an electric car (toy sized). He did not have to pedal and was going very fast. Part of the childhood obesity problem is toys like that that do all the work for you. Bicycling is much better for keeping kids at the proper weight.