As a Mom with 3 kids, they don't always realize what things cost. My youngest want's an xbox he has no clue what they cost or if it's a lot of money. They're allowed to dream too. Just because their parents may not have money it doesn't mean that they can't want things.
They wouldn't be kids if they didn't want the same things most all the other kids have.It's a "wish" section, not a "you will buy me these things".
Just because they are poor doesn't mean they stop wishing and hoping.
As far as the OP, it entirely depends on what your financial situation is.We've spent less some years and more others. This is a "more" year.
I really don't think that's what she meant. I think she was saying that the parents should have told the kids that those items might not be appropriate for such a list. Like on Halloween when people told my kids they could take a much candy as they wanted, I made sure they only took a few pieces, not the whole bowl.
As for my gift expenses - I seem to fall right around everyone else. We have two and spend 100-200 for birthdays and 400 for Christmas. Although this year they both needed new bikes, so we we went over budget to get them good bikes.