Well, I am sure they would have the same ones we see in the ancient world. Dolls, wooden horses, toy soldiers, toy weapons, marbles, balls, etc... As far as magical ones, this is where the fun really begins. I can imagine illusion-based things being popular. Perhaps a tiny magical carousel? Or a magical version of a lantern cut with silhouettes, so that when you put a candle inside it, it throws out images of the silhouettes on the walls. Only in this case it would not need a candle. You just turn it on and it spins, projecting images of little dragons flying around the walls of your room. Or maybe a magical ball that moves around on its own, and the kids have to catch it?
Oooh, your magical toy ideas are a lot cooler than mine!
And I think the most popular thing would be Illusion too, since Restoration wouldn't do much, Mysticism is too unpredictable, Destruction... well we won't go there, Alteration would be a close runner-up to Illusion, and Conjuration would be out of the question. (I'd hate for my kid to summon a daedra!)
Maybe magic wands that just did little things like created sparks of light, or potions that made them float for a little while too. :nod:
But yours are much more original and creative, I'd be bad in the toy business.