I disagree that free ranging roosters are more aggressive than other birds. We have had many a free-ranging rooster, and only a couple had to be culled for aggression. I have two kids, three and six, so it's not the kids, either. Our birds are not technically free range, but they are pastured and are in a 75' x 125' area so the roosters have predators to watch for, etc.
Either a rooster is wired to be aggressive, or he is not. You have young children, and a rooster attack can literally and metaphorically leave them scarred. In fact, I have a friend with a nasty scar next to his eye from a rooster attack when he was about five years old; he was very lucky not to lose the eye. And you are setting your kids up to hate and fear chickens, which I doubt is what you want.
Cull the rooster. Your children are more important than a chicken. You won't rehab him, and you'll never, never, ever be able to trust him around your kids and around their friends. If you need more incentive--just think about the lawsuit if the kid he goes after is one of your kids' friends...
After you cull the rooster, remember that roosters are like bulls and stallions--they always have the possibility of violence. Just because a chicken is small doesn't mean it's not dangerous. Always supervise your kids when the rooster is around. Never let them chase him or the chickens or act like predators towards them. In fact, I personally wouldn't have a free-ranging rooster and small kids at all. If I were you, I'd either fence an area for the chickens or not have roosters at all until your children are much older.
