Well if a 4x8 is too bulky, go smaller, I'm building a G guage portable layout, thats only 3ft square!
Its also intended to be easily portable, what it lacks in trackwork will be made up for in extra detail.
Heres a suggestion for some inspairations for smaller more portable ideas.
Scroll thru this site, I'm sure you'll find something your kids will want to build. Be sure to check out the scrapbook entries to see what others are doing, Good luck!
Have fun with your trains