Alright, I can base this huge theory on this agenda really quick.
First off, the kids are apparent in the tutorial parts of the level, but what essentially they become are an agenda for Link to look after. He's grown up with these kids for most of his life, so there's a strong connection to be the figure for them to become. The fact they are ignored is because Link has a greater sense of duty. Once he knows he's become the next heroic figure set to save Hyrule, his duties lie elsewhere. BUT, and this is a biggie, the story to set him off on his heroic adventure was to save the friends he grew up with. That's why he set off out of Ordon and why he was willing to follow Midna in everything she asked him to do (if you remember the first cutscene with Midna, where she transforms into Ilia and Colin to get his attention set on trusting her to get out).
Upon entering Kakariko Village, his duty was to protect the children first. As soon as Epona was his, and Colin was taken away, he made sure he rescued Colin. So it's not essentially they were a small bit role. In fact, each kid set him up on a greater journey. If it wasn't for them, he would not of known the monkeys and they would not of helped him in the Forest Temple. If it wasn't for the kids, then the feud between the Gorons and the shaman would of been ever present because Link would not of known if they were not found. If it wasn't for Ilia losing her memory, Link would of never met the Zoras, never would of gotten the Zora Tunic upon escorting them to Kakariko Village, and therefore Link would of never gotten any of the Fused Shadow. Plus, without the loss of Ilia's memory, the Hidden Village would still be hidden away, and the Dominion Rod would never have been awakened again. Along with this, Rusl might never of set out to try and find them, to work with his old group, and Link would not of been able to access the Temple of Time in the Lost Woods. Despite what seems like a small part, the children played a bigger role than we thought, getting Link access to more than half the dungeons.
Now, with the so-said "love interest" between Ilia and Link. I think, no matter who you are, if you grew up with someone for the majority of your life, you are bound to develop a very close bond with them. And considering they are of opposite genders, then OF COURSE there's gonna be a connection, especially with them being at the height of their teenage years, ripe with...well, you know. But when Link set out, I think upon meeting the Princess, he probably felt they had another close bond, but one based upon the Triforce and their past versions of themselves. So in a sense, Link had a connection with more than one person in the game, both on a personal level and a historical level.
Lastly, to comment, the children never left Kakariko Village because Hyrule Field was swarming with monsters, and without any sort of protection, they had no chance in getting back to Ordon Village, so it was up to Link to make it safe so they could.
Now you tell me they had no role in the game!
And I agree with bry. I bet, in some future game, Link and Zelda will develop a bond that will actually connect them to their feelings of love.
Now, as far as extra characters go, I like the wide variety we are given, both in human species and in the other denizens of Hyrule. I think my favorites are the six sages in Ocarina of Time, but all the denizens you help in Majora's Mask are also a fun way to waste time in the game.
