We found some toddler rain gear at our local Totes store. They were around $5 and perfectly sized for the kids. They came in different colors and had a little character of some sort on them.
We use "disposable" ponchos that we purchased at Harbor Freight for around $1. We use them when we travel and we bought them 7 years ago. They are the thicker style one. We just fold them back up and place them in a ziploc bag or a space saver bag. Put in our backpack and they are ready to go.