i really dislike the toys r us in times square. the staff can be rude, the place is packed, i once waiting for what felt like five years to ride the ferris wheel, and well there was a really bad odor within 100 feet of the restrooms. i say skip it and go to FAO Schwartz. its only a few blocks up on 5th. on the way you will pass saks, cartier (which looks like a giant gift at that time), and tiffany's

. toys r us is just a giant toys r us. fao is amazing. last year i went during dec. and they had a barbie Foosball table, way more unique. you can then also hop over to central park for a bit. if you get tired at that point you can easily cab it or take the subway near the plaza (N,R) back to times square.
the concourse at the rock has lots of little deli type places. you may need to negotiate lunch time work crowds and tourists but they do have tables down there near the rink so you can watch the ice skaters without the price tag of the restaurants. i saw them putting up the rink the other day and i got super excited. im really bad for lunch tips b/c i bring my lunch 90% of the time and if i don't i go to one of three fast food places.
i used to love magnolia, now im falling out of love with it. the lines are always long during that time of year and a lot of people feel their cupcakes are no longer that great (plus at 3.75 a pop they are pricey). im GF so i don't eat the items, i pick up upon request, so i have not ate anything but bouchon opened up earlier this year and the stuff looks good. they also have a little counter and if you get there in the am you can have a coffee and pastry while watching the today show being filmed outside.
i also love the rockettes but it may be too long for your 5 yr old. if you like them on facebook and sign up for emails you will get emails with discounts all the time.
finally it may not be your thing, but if you celebrate christmas or like architecture a trip into st.patrick's is always a must. they will have the nativity in the front of the church at the time of the year.