Children are neither, and dammit, if they story calls for it, they can handle you killing off Bambi's mother or Simba's father.
Speaking of killing that word popped out a lot more so in this movie than others. Oh how I loved Queen Narissa.
I can admit that the partial recycled-ness (and the fact it was a fish outta water story similar to The Little Mermaid) is why I ended up liking it so much. But I agree to you that I wish animation got the love it deserved. Shoot I'm still rather mad at how the U.S. treats anime if it's sorta "not cut" on adult swim. I personally don't understand why we can't introduce our children to a different culture because when you get rid of the original voice acting that is what happens. I can't even begin to state how reading subtitles has improved my reading accuracy but anyways that's a rant for later...
I feel Disney's afraid more so because of, like you said, merchandising and financial reasons, which is so stupid. Movies should be made because there's a love invested in the script and the characters and to tell a great story!