Highly recommend Ming Cha for tea and contemporary Chinese tea sets. Just lovely. Have quite a bit of it myself, and been sending a lot of it abroad as gifts recently too.
www.mingcha.com.hk
Easiest place to find them is in Citysuper in Times Square (Causeway Bay), or Great in Pacific Place, Admiralty. They do have a fabulous stand alone shop in Star Street off Queens Road East, next to 3 Pacific Place, but it might be a bit tricky to find unless you're familiar with the area.
I'd leave the Hello Kitty stuff alone!
For children's gifts, try the vendors in Li Yuen Sts East and West in the heart of Central, known as "The Lanes" which run between des Voux Rd and Queens Rd. Lovely cotton or silk Chinese pyjamas and little cheongsam, should be able to negotiate to about US$6 per piece if you buy a handful at once.