They are none of the above - they are multiracial children. You must understand that the proposal in effect says multiracial persons are only part of other communities. They are not whole. I think it still does - unless you are multiracial. It was a compromise with the opponents of a multiacial category.
Identity has to do with protection, association, and recognition.
People identify themselves in certain ways in order to be associated with people who ascribe value to them, who take them seriously, who respect them and for purposes of recognition, to be acknowledged, to feel as if one actually belongs to a group, a clan, a tribe, a community. Please take my children's multiracial identity seriously. Show respect for them and the fact that they DO belong to a community. It is important and it is very, very real. In fact, people of all races have been glad to have the multiracial category.