Tonielle, I totally see your point. Having a dog that bites around children is never a good idea. I wonder how old the children are? Yorkster didn't mention....?
But you are right, their friends may come over and not be familiar with dogs and behave badly...anything could happen...
If the children are a bit older, I would keep the dog I think. If they are young, it's not a chance I would take. I wonder what the county or town is doing about the dog? The bite had to have been reported and in a case like that, they usually take the dog, even if it was the owner that was bit.
Growing up, we had a cocker spaniel that bit every single family member the first week we had him. He bit my 2 year old sister on the 7th day and my parents took him back to the breeder that day. They had 3 children aged 7 to 2 and could not have a dog that would choose biting as its defense. (she accidentally kicked his leg while he was sleeping and she was walking in her little toddler shoes.)
It's definitely a tough call for the parents. Akitas are not easy dogs either. They are consistently one of the top 10 biters every year. I think they are very "one-person" dogs from what I have read. They are gorgeous animals but not quite "family" dogs. Don't get me wrong, I love them, I'm just going by what I have read about them.
But anyway, I see your point Tonielle. My own dog cannot be around children and I thank God every day that I adopted him, rather than a family as he would have never made it in that atmosphere.