Courtesy is important. If you're standing with your abck to a wall or in some area without people close behind you that would be blocked, then who cares. If you're in the middle of a sea of people watching the projections on the castle or a parade, and putting your child on your shoulders is going to block the views for 50 other people, then that is a little rude. Not everyone who does it is intending to block other people though, and may not have even realized that they are. Some kids, even held at hip level aren't able to see, just as many adults can't see if they're shorter.
The crappy thing is, LOADS of people are not able to see the projections and parades clearly. Your vision can be blocked just by standing behind someone taller than you, or someone holding their phone or camera in the air, or a taller person putting their kid on their hip directly in front of you if you're shorter. Many times, you think you found a great spot only for someone in front of you to stand up and block your view, or a taller person to join their family in front of you, or hold up their phone to record the show, or whatever. Just people moving their head side to side in front of you in their attempt to see past the person in front of them can in turn block your view and become frustrating.
The fact of the matter is everyone wants to have a perfect view and most people are not trying to be jerks and ruin the experience for everyone else. A little courtesy goes a long way, but at the same time, everyone needs to have realistic expectations that in a group of thousands of people, most are not going to have a perfect line of sight, regardless of how considerate everyone may try to be.