Real-Life Salon
If you're feeling bold, you can supervise your kids in their own hairdressing studio. Avoid dyes and scissors---instead practice crimping, curling, blow drying and general hair styling. This is the most fun you can get hairdressing without actually working at a salon because you get to interact with real hair. It's important to supervise so hair doesn't get scorched, products don't get overused and you don't end up with alien-looking hairstyles that turn out more permanent than expected.
Doll Salon
If you can get your hands on some old dolls, set some aside for a hairdressing day. Keep in mind that most of the dolls will probably appear disfigured for the rest of their lives, so only use ones that you would otherwise throw away. First, give your kids some paper and drawing materials to sketch out what they want their hair to look like when it's finished. From the drawings, you can help instruct the children on how to best execute their haircuts, but with the understanding that it probably won't look exactly as planned. Being sure to supervise, allow your kids to take over the cutting and styling process.
Video Games
"Picture Perfect Hair Salon," for the Nintendo DS, is a video game that allows kids to snap photos of themselves and their friends and then digitally alter their hairstyles. Using the stylus, they can adjust the hairstyle, length and color and add curls, spirals, bangs or pigtails. Because they're using photos, it's an effective way to try out different styles and colors without actually having to live with the consequences.
Online Games
There are endless online flash-based games that deal with hairdressing, mostly targeted at young girls. Most of the games are very similar to one another with a click-and-drag feature that alters the color and shape of a model's hairstyle. Though these games are not very complex, they are free and, with so many choices out there, you're sure to find one that fulfills all of your little ones' needs.