I am sorry to hear that your children have KP. There are some natural products that are made with coconut oil and lactic acid that have been suggested for kids on this forum - look for Annu's posts - he has alot of helpful information.
Your daughter that gets the red flushed cheeks sounds like she may have KPRF - Keretosis Pilaris Rubra Facei (sp??)....you can look at this site for more info on that or google it. It seems that it is common for Dr's to not know much about KP or variants of KP like KPRF and just say that it is a heat rash, eczema, or hives when actaully it is KP.
There is not one magic cure out there but one thing that has helped my son who has KP is to add an omega 3-6-9 supplement to his diet. I use organic flax seed oil. I add about 1 tbls to his milk or yogurt (he is 18 months and about 3o lbs). Flax seed is actually a really good fat for kids to have - it helps with brain development. The kind I buy is from 'Whole Foods' and it also has DHA (found naturally in breast milk) in it which is now found in baby formula and a bunch of other baby products. I also give him about 4-6 oz of carrot juice a day - I mix it with apple juice and he loves it. Vit A helps KP in some cases.
Best of luck.