I would try everything else under the sun before going the Melatonin route to make sure there isn't something else making it hard for them to fall asleep.
We ended up using it with my (then) 3 year old and it was a lifesaver. He went from staying up until 12 crying that he was tired and couldn't fall asleep, to being asleep by 8. We only ever used 1mg, and we used it to sort of reset him for 2 weeks and then as needed, NOT every night.
The side effects include vivid nightmares, so be prepared that could happen. My son never mentioned that he did, but my 21 year old brother says it happens every time he takes it and for him it's not worth it.
You can develop a tolerance to it (not dependency) and need to up the dosage every so often if it is not working anymore. We never experienced this, but also used it on an as needed basis after those 2 weeks.
A year later we haven't used it in 7 months at all, and we only have those super late nights every couple of months or so. Usually in those cases, there is another reason behind it.
Stick to a rigid bedtime routine and time when using it to make sure you are not using it instead of instilling good sleep habits, but to promote them.
Hi I'm Sara mommy to 3 little Mischief Makers