Thank you everyone for your comments. I am still thinking them through. I am awake as it's really bugging me. My parents were extremely unfair to me and I think perhaps I go OTT trying to be fair.
I've gone back and forth for a few years on whether I accept the money and following lots of advice from people here when I previously posted in detail about what I experienced with my parents, I decided a few years ago that I am taking the money (on my children's behalf, directly in their accounts - I don't touch it) and thinking of it as compensation for how they treated me. My parents spent all the money I was gifted as a child from other family members and friends on the basis that anything that belonged to me is theirs, and I don't want my children in the future to think that I made decisions about their money that weren't mine to make. My dilemma now is about whether I split the money between them.
I just remembered a conversation I previously had with FIL on DC1's first birthday. He told me his grandparents favoured him over his siblings and he found it awful. His parents used to divide up his gifts equally amongst all 3 children, including money, and when he got older he did it himself as he found it awful how his siblings were treated.
@Mummyof287 I am sorry to hear of your situation, my children are not at an age yet where they ask questions or would understand.
@RedToothBrush that is awful, I'm so sorry for your brother  in my family I felt I was the one who wasn't acknowledged eg as a child I got presents that my mum wanted eg perfume, she said it killed two birds with one stone as she'd ticked off getting a present for me and she got something she wanted herself. When I got married, DH would get big presents and I would get my own property wrapped up eg I once got my own broken childhood necklace as a present, DH got expensive clothes worth £00s.
@OhMyCherriePie @mamapiggywig this is what I have had to do with money sent to my bank account but they are tenacious and it's been going on every month for 3 years, they are persevering with it. I just remembered, I can't do this with the children's accounts because I can only withdraw money once a year.
@DollyDoofer I am not sure how fortunate they are. My parents use gifts to control people. I hope it won't bite them in the future.