I don't know the age of the kids so it is hard to judge how shocking their behavior is but I assume the parents are old enough to know better. My kid is a brat and I know that but I don't expect other people to have to suffer because of it. I could see my daughter doing something like coughing in someones face when she was two or three (or even now if she thought it was game), little kids have poor judgment and worse impulse control. I couldn't imagine laughing it off and calling it silly though. At a minimum I would have chastised her and made her apologize to you.

Are the kid's parents a lot older than you? I know I have a tendency to let my daughter pester her grown brothers a LOT more than I would ever allow her to pester other adults. If I am honest with myself it is partly because I still think of them as kids and because I think it is funny and reminds me of how they just to pester me when I was not much older than they are right now.