If your kids are so eager to write books that they're practically oozing stories out of their pores, here is a fantastic family-friendly website you may not have heard of: STORYBIRD. Young writers of all ages can register for a free account, choose from thousands of illustrations by professional artists, and use them to create an online "book" for the Storybird community to read. There are writing guidelines and classes for kids, a thriving community of readers who offer encouraging feedback, and you can even print a physical version of the book (though it's not cheap!) What a great opportunity to give your imaginative kids an outlet for their storytelling!
I actually first found out about Storybird through an artist friend who posts his art there for people to turn into stories. Jamin Still's art is luminous and mysterious and magical and always makes me think a story is simmering just beneath the surface. You can learn more about Jamin in Storybird's interview with him.