Although I agree that yorkies and small children aren't a good fit.I have a neighbor who has a 4 lb yorkie and 3 girls. they were 9 7 and 3 yrs old when they got him...I was really nervous for the dog! They are AWESOME with him! on the other hand I have 3 grand children the oldest being 5...She LOVES my furkids but, will NOT leave them alone...She have NEVER hurt them but, will try to pick them up...once, when she was 3, she picked up one by her neck!
now that she is a little older she knows not to pick them up but, sits on the floor and lets them go to her....which they do!
as far as getting a small dog with small children....I don't think I would do it but, your kids seem a little older...maybe it would work