Organizing a play date, where each Mom must plan one arts/craft activity is a great idea for a rainy day. It would require some planning, but a great way to keep the children engaged, away from TV and after the activities, they can continue playing with their friends and get to take their creative products home.
Have a dance party. Get the kids dressed up give them glow sticks or torches. The torches can be turned on and off like a disco. Play different types of music and dance and sing with the kids. Then you can start playing musical games like statues, bobs or make up a dance. The kids will have fun and should sleep well afterwards!
Dressing-up is loads of fun for kids on a rainy day. As a Mum it's also a lot of fun to organise a dress-up kit and quite affordable. It's something that you can begin quite simply and build up with more and more items over time. Visit your local op shops and flea markets, and see what exotic things they have...funny hats, wacky glasses, bright-coloured scarves, sparkly sets of beads and old clip-on earings are a good start. You're only limited by your imagination!