well, I am a bit surprised at this thread.
I would be fine with 5 year olds and sleepovers, depending on the child. So ds and dd1 would have been fine, dd2 not as she would not go to sleep when people were around.
We had it quite often as friends families would come to stay, and all kids together in dds' room, while parents took ds room.
We always had to put dd2 in my bed until asleep.
So, if you know your child and they will be fine, why not?
mn is a bit funny about sleepovers, seems like it isn't ok unless they are about 15.
I also don't think it is a problem being downstairs, I would be around (in kitchen or dining room) until they were asleep. If really worried, I might put a baby alarm downstairs in case they woke up.
and I agree with angel. Do not sleep in same room as the kids. That would make me more uncomfortable.