I lived in Portland for over 10 years, and I would say that our favorite kid spot was Old Wive's Tale on Burnside east of the Willamette River. They have a kid's play area inside of the restaurant and folks that eat there are very kid-oriented.
They also have a great menu selection, so we enjoyed going there. The hardest part when our son was young was getting him to sit at our table long enough to decide what he wanted to eat. He'd rather play with the other kids in the play area.