Akittrell,
Here is a link that will help you to understand some of the growth stages that your pup is going through. It explains some of your pups behavior at this age and why it is so crucial for the pup to stay with the mother and litter until at least 8 weeks of age.
GSD Development, An Illustrated Guide to the First Year (Plus)
I have 4 children between the ages of 5-10 yrs old, but they have been around dogs all of their lives, so they know the rules. My favorite saying is "THE DOG IS NOT A TOY." If this is your first pup with the kids, then you will have to be strict in their handling of the pup, because you want it to grow to love them. Your 10 yr old will be a lot easier to teach right now, but you will need to be very careful with the 2 yr old. I know GSD's have a reputation for being great family dogs, and they are, but you are dealing with a newborn in completely new surroundings that was pulled from its litter before given the time to learn basic socialization skills. You definitely don't want to establish bad experiences between the pup and your kids, because the pup will then relate pain, hair grabbing, etc. to the kids and may have trouble bonding with them later on.
I hope this will help you some and you haven't been discouraged from further postings and questions for help. Try to research as much as you can on the breed, and check out as much as you can in the puppy section. There are tons of valuable information to be learned as I am still learning myself as my pup is only 6 months old. Look into puppy training classes in your area, youtube, and google as much as possible. I found great training videos on Youtube when I first started training my pup. Its a lot of work, but as your pup grows and develops, you will be amazed at his intelligence and learning ability, so don't let this incident make you think you have a crazy pup. You'll be fine!
