Once the cherub is 2 and no longer a lap infant they will earn Avios and Tier points at the usual rate (but better TP/£ ratio due to lower taxes etc!) A non-status adult can be guested in by an entitled little one (who needs an adult to get into the lounge, so it works both ways!).
My aim to get my wee one to Silver to guest her Mum in when we fly separately!