We fly alot w/our kids and while we invested in a leapster for a day of 11 hours in the air...our kids tend to be happier w/the cheaper stuff! I have an 8yr old DD and 4yr old DS and they both love Dover sticker and activity books ($1.50 each). We buy a ton before we go and whatever we don't use on the plane we have on reserve for long waits like at restaurants.
We bring simple card games (the dollar store near us has had Bear in the Big Blue house, Barbie etc), a few paperbacks to read to them or for DD now that she can read, blank paper, crayons, small cars, small plastic animals or people (again, $ Store is your friend), mini etch-a-sketch and magna doodles. When the kids were little they also *loved* mini-containers of playdoh.
We bring pre-packaged Lunchables on board w/us even if there's food service since the kids tend to hate whatever is served.

And water bottles (too many juice spills so we tend to avoid juice boxes), granola bars, oranges, and a few candy treats. Also, don't forget to take care of those little ears w/lollipops, gum, fruit chews or something else that will have them chewing and swallowing during take-off and landing.
Karen