I'm a longtime reader of XKCD, recent reader of these forums. This whole question really made me want to weigh in.
I say Yes, tell them about Santa. For my parents, it was enormous fun, and I definitely recall it being a huge amount of fun for me as well. I was the youngest in the family--once my sister got a little older, she got in on the act too, and she loved it. When I was about nine or so (don't recall exactly, maybe ten) I was puzzled enough by the inconsistencies to ask them straight up, "Is Santa real?" and they asked "Do you really want to know?" and I said that I did, so they sat me down and told me the truth. I was glad they did, and though they were worried that it would mess up my Christmas (this was early December), I took it very well and didn't mind at all having my suspicions confirmed. I loved the mystical feeling of Christmas before then, and afterwards I felt mature enough to just appreciate the season of giving. I don't think there's anything wrong with Santa, like there's nothing wrong with reading fairy tales or make believe. Kids do make believe games constantly... they understand how it works. If we tell them that there is no fantasy, that all made-up things are worthless, then how do they ever get that creativity that kids find in their imaginations?
An additional side note that made me almost really believe in Santa (and made me prolong the Big Question to my parents for about three years)... one year we were at the mall shopping for presents in mid-December and we were eating in the food court. My mom nudged my shoulder and pointed out this guy sitting at a table off behind us--a giant fat guy with a long white beard, all alone, and with a sprig of holly on his sweater. He didn't even glance our way once, but my mom and I raised our eyebrows a lot. Then as we were getting up to leave, I felt this hand come down on my shoulder, and there was the guy, staring down at me. He smiled and said "You never know when you may meet the real Santa Claus", and then he was gone. I still treasure that memory today, because what if? I can't believe that wondering "what if?" is a bad thing. I want my hypothetical children to wonder too.
A good pun is its own reword.
L wrote:A day without kells is a day not worth living.