They may not recognize the movies, but there is a LOT to see, each scene is jam packed with STUFF.....most children would recognize Wizard of Oz at least. If you've been on it again, you know that a 'bad guy' takes over the ride and while a bit on the cheesy side for adults, there have been several times that young children have made comments that make you realize THEY think it's real, lol. Of course, for sensitive kids that can be difficult. Then there is the alien exhibit....which my girls absolutely hated (back in the day of the dropping creature) and have refused to watch the movie, lol....even though they love classics and have seen 99% of the rest of the movies in the ride.
It's about a 15 minute ride, so it's not like it's forever....FP are easy to come by same day....so I'd go for it. Worst case it will be a first and last ride.....but chances are they're going to want to go on it again to see more....we go on it each trip and there is always some little detail I either forgot or never noticed.
All that said, I would love to see them update it or add to it......there have been a lot of good "classics" since this ride was made that could add....but I hestiate to think what the current management might do to it....I really don't need to have Frozen in there, lol. Now that Turner Classics is involved, we may see some good stuff though. (Fingers and toes crossed).