I don't limit. I might be one of those really weird moms out there :-) My DS8 is an only child who wakes up at 6am due to natural body clock. He's on the computer by 6:15 pretty much every day. He plays online games like Bloons Tower Defense 4, software like Zoombinis and Nancy Drew mysteries, messes around with the Lego Design by Me etc.
Literally ALL of his friends play Club Penguin. Afterschool, it's pretty common to find 5-8 of them in an igloo chatting and playing minigames and working on missions together. Since kids go to his school from all over town, playdates are fairly rare and this is really his social time.
It's not uncommon for him to be on the computer or his DS for 3 hours a day, 2 of which happen before 8am. I don't worry about it. My brother is a coder and game designer, my dad is a systems engineer and my DH is a gamer. I only would be concerned if he wouldn't walk away when asked- so far that has never happened.
