So maybe your kids are just a little too young for handling a recorder, but you still want to try some music with them. Try playing little games with them. Under about 4-5, and almost all their learning really should be through play, and even after that it should be fun. You can use baby rattles or egg shakers like these ones available from Amazon.
You could even make your own tambourines. That’s right! I found this little gem on BusyBeeKidsCrafts.com. They did a fantastic job in explaining everything.
So now that you have these wonderful rhythm instruments, what do you do with them? Think about how we learn, we mimic, we memorize, we attempt to repeat it. As we grow, we learn to expand upon that and “own” it as our own skill. These things lead to greater learning in the future. So babies and toddlers who copy something they saw big brother or sister doing are just doing what is natural. They are learning by mimicking.
Take this natural inclination, and turn it into something beautiful. Make up a basic rhythm, and see if they’ll try it. Then, when they shake their tambourine or egg shaker differently, you should try to copy it. Make a game of it, and most importantly, have fun!
Here are some other resources for homemade instruments, ranging from the very simple to the more elaborate.