We live in a quiet little village in a semi detached bungalow. We have 1 26mth old DS. My neighbours (attached) are very elderly and constantly complain about how much noise ds makes, from laughing and singing, to his toys etc. They never come right out and say it but they drop lots of little remarks into conversations whenever I see them. My feeling is DS is not a particularly noisey child, and when he is on his own is quite peaceful and easily occupied. He has no really noisey toys and enjoys playing with his train set, dolls house, drawing etc. He does like to sing and laughs a lot but I don't feel I can tell him not too and this is never ridiculously loud! He is a happy child, I feel he should be able to express it! Also we are rarely in the house, if I'm not at work and he isn't at the childminders we generally go out for the day. I also looked after my nephews yesterday and have already had lots of comments from neighbours about the level of noise. 
As I see it the problem is we live in a very quiet, mainly elderly cluster of houses. Our neighbours barely make any noise at all and are in all the time. So I really do understand it from their perspective, they have a young family next door who in comparison to them are very noisey. However I feel I have taken all reasonable steps to resolve the issue. We have moved DS's room to the other side of the house, so furthest away from them, any noisey toys are in there, we do quieten him if we feel he is too loud. they complained alot when he was a baby, crying at night etc (again he was a good baby overall) and now I am due second DC in a couple of weeks IO am dreading their comments.
I get really anxious if I feel I am upsetting people and on the whole these are lovely people but I am worried about causing them stress especially when DC2 arrives! I don't want to be a bad neighbour! Should I try and confront it head on, but if so what can I do about it? I can talk to them but I can't think of any further solutions I can offer them??? I will not gag my child!