When I was growing up there was always a certain amount of cruelty associated with April Fool's Day. It seems someone would always carry a prank just a little too far and someone would get hurt. What should have been a funny, joking sort of day was often used as an excuse for all sorts of mean behavior, which was dismissed with, "April Fool's! Jeeze, can't you take a joke?"
This is why, when I had kids of my own, I decided to re-make April First into a gentler holiday. We took the focus away from making fools of each other and put the spotlight on fooling around together!
Little kids think it's just hilarious when things aren't the way they "should" be, which is a fine characteristic to exploit on April first. Turn the table upside-down before they appear for breakfast, then set it as usual and pretend you don't notice anything. They'll be astonished! At story time, read their favorite books as usual - but hold them upside-down and "read" as though you're talking backward. Again, pretend nothing is unusual - when the kid turns the book right-side-up again, say, "Oh! I didn't even notice - it must have been the April Fool!"
They may grow more sophisticated as they get older (though I'm always surprised at how well the good old jokes still work - I actually got Jack with the old "Henway" chestnut last week!) so you have to find new ways to mess with 'em. Fill a backpack with Superballs and a hatchback with balloons. Serve dinner directly on the table - no plates or utensils - and hand out serving forks to eat with. (This works particularly well with spaghetti.) Whatever you do, act surprised that they're surprised, and blame it on that enigmatic gremlin - the April Fool!
For the last few years Lance and I have made an April first tradition of serving a snack that is food that looks like some OTHER kind of food. You can find all kinds of useful recipes on the Web - we've made candy sushi, Rice Krispies meatloaf with ice-cream mashed potatoes, candy fried eggs with caramel bacon, individual "chicken" pot pies that were actually filled with vanilla pudding and dried fruits and many other delicacies. This year I fooled them twice - not only were their ice cream cones actually cupcakes, but they got 'em for breakfast (since that was the only time they're all going to be home today).
Being an April Fool is as much fun for me as it is for the kids. It's entertaining to take an "Animal House" approach to your usual routine and look at things through fresh eyes. It helps to exercise everyone's senses of humor and wonder and gives us all a chance to laugh together.