Playing chess involves many components of logic and knowlegdge, so I would not encourage younger children to start with the full 32 pieces laid out at the start.
A better way is to start with only the pawns on the 2nd and 7th rows. The objective is to show how pawns move and promote. The side that promotes first wins. Try playing this with the children to get them to understand how pawns move and can capture. They will grow up learning to push their pawns carefully.
After considerable hours are spent, perhaps introduce the Kings into the starting position of pawns alone. Then after some time, add the pair of Bishops. Then the Rooks. Then the Knights. Finally the Queen.
A gradual introduction of the pieces would gradually expose the new player into the powers of each piece through play. The child can start as early as 3 or 4 with this approach, gradually easing into the 32 piece starting position by 7.
Now for the new tournament kiddos. As parents, what counts is the ability to pacifiy their children when he/she loses. The last thing any parent should say to their child after a loss is : "NEVER MIND". How many times do we hear this at tournaments? Sure, its the right thing to do after a sobbing child clamours for relief after a traumatised episode in which his/her King is checkmated. However, this is where the greatest damage is usually done.
Saying NEVER MIND after a loss is in fact condoning failure without the need to reflect or be accountable for the loss. The child is pacified and goes on playing another game , takes no steps to correct his/her play. Rather, it would be best to invoke the investigative and inquisitive young mind to ponder how he/she lost that game. Many would have no clue. So its good to have someone patiently explaining the game to the player the seeds of defeat and advising them to try not the same mistakes. But of course they will. So its a constant battle to remind them until the message sinks in.
Hence, preparing a child mentally to face competition is just as important as equipping them with the knowledge to play the game. Otherwise, the benefits of chess may not be fully understood by the players and parents themselves. Spending hours at a chess tournament can be daunting, even more so if nothing is gained out of the activity. I believe that some quality growing up and bonding time can be spent between parent and child and this makes it all the more worthwhile for the parent-child relatonship in their formative years.