I have always found that gate-checking works OK, but unlike others on here mine has always ended up on the conveyor at the destination rather than the gate, even with orange labels clearly visible. It's also worth noting that apparently they never take them to the gate at LGW.
If you can get one that fits in the overheads then it's well worth doing. I've got a larger gap between my kids (4 years) so the older one is happy to walk. The younger one (turning 1 tomorrow) can go in the carrier. With two young ones it's good to have an option to push one and carry the other I expect.