What I suggest doing with the toys is putting half of them(the ones that aren't played with much as well as the really messy toys) in a storage bin. Put this bin away for a month. If they ask for a specific toy, go take that toy out(while they aren't looking) but replace it with a toy that is out. You'll find out which toys they enjoy playing with and which toys they could care less about. At this point there a couple things you could do....
1. Every 4 weeks pull out this bin and put it in their room. Now fill the box with all the toys(except for the few special/favourite toys) that have been in their room. They will be excited to play with "new" toys, there will be less mess to clean up and everyone wins:)
2. Give these toys to a shelter or sell them.
3. (This is what we do) I sit down with my kids and sort out 2 different piles- 1 pile is a keep pile and the other is a give away pile. There has to be at least 1 toy in the give away pile for every 3 toys in the keep pile. At first this was really difficult and there were meltdowns so we just chose a few toys to put in the give away pile. Now, my oldest really enjoys doing this. It makes him feel really good about giving to those in need and I want him to see that giving things to others makes him happy:) My 4yo is starting to enjoy doing it as well. We drop off the toys to a woman's shelter in town and they come in when we drop off the bag to see the happy faces of the staff. It's great:) We do this about twice a year. If I had to guess, all of our kids toys could easily fit into a rubbermaid container about 2' x 2' x 2'. That's minus the dress up clothes. Those are always available to play with.
Craft stuff has to go into certain bins and has to be cleaned up completely before moving onto a different activity etc.
I'm sorry I can't help too much with the emotional bond issue as I feel strongly that stuff is just stuff. I am a minimalist when it comes to what I feel I need. My parents were very spendy and until I had kids I spent a lot of money too...in the hopes it would make me a happier person. I want to teach my kids that they don't need tons of things or to buy stuff to feel fulfilled. A cardboard box gets way more use in my house than the $100 gift they got for Christmas....LOL
In regards to the purging/organizing...for those that are interested-
I've actually gone into a few of my friends houses and helped purge/organize and as we are going through their things, I have questions I ask them.
When was the last time you saw this item? Did you remember you had it? What does it do for you? Most of the time if you haven't seen it for years and it's just a dust collector...it can go. If it holds real importance(a piece of history from your family etc) then of course it's a keeper:) If it's a knick knack from a holiday....I chuck it...LOL
Also, for every item you keep...one must go. If it's been in storage for 5 years, and you forgot you had it... you most likely don't need it.
Make sure that you have a home for EVERYTHING you keep. Go through your storage area EVERY year and get rid of things as it accumulates every year.
Sorry for the novel...if you can believe it I LOVE organizing and cleaning...it makes me happy :) LOL!