Where do kids get off stealing the afikoman and then demanding a gift for its return? The Talmud (Pesachim 109a) recommends taking away the matzot to keep the children awake. Later commentators suggest allowing children to hide the afikoman and giving them presents as a way to keep them involved in the Seder until the very end.
Rabbi Chaim of Brisk frowns on this custom as the afikoman symbolises the Pesach sacrifice and needs to be protected until eaten. Placing it under a pillow is a good idea, but allowing kids to hide it who-knows-where could be risky. Some Sephardic communities dropped the custom of hiding the afikoman as they feared that their non-Jewish neighbours would say that Jews taught their children to steal.