Wa'alaikum Assalam Peaceful Mama:
DS1 and DS2 are both in public schools. This is our first year in FL schools, prior we were in Brooklyn/NYC...which was, as you can imagine, much more diverse... and thus, less-likely to be Christmas focused.
DS2 participated in his school's Nutcracker field trip and production.
I know they'll be doing some snowman crafts... and I believe DS1 is making a reindeer t-shirt. I debated just how much I wanted to get involved... and after talking to quite a few Moms I know who've raised both Muslim and Jewish kids here (who are still practicing...and alhamdullilah their girls still wearing hijab now in college)... I've decided to not make a big deal about any school activities... BUT...to talk about things when they get home.
So...for example... the Reindeer shirt... we may look up actual reindeer and talk about them. (Finnish Reindeer, not Santa's.) My kids also know the story of Santa, which doesn't bug me--as they're also quite well aware that we're Muslim and we don't celebrate Christmas, but we sure think that Prophet Isa is great. As they get older, we'll talk about how our views on Isa are similar to Christians, and how they differ.
Regarding Hanukkah, I have no problem with my kids knowing the story about another one of Allah's (swt) miracles. Just doesn't phase me. I may use it as a jumping off point to talk about other miracles.. or even ways that Allah(swt) is blessing us right now. They can play with dreidels and eat Hanukkah gelt to their hearts' content as far as I'm concerned.
I thought about pulling them out, or talking to the teacher... but I know a few kids whose parents did that... and they hated being singled out like that. They knew they didn't celebrate Christmas or Hanukkah or whatever... but still wanted to do the activities with their classmates. I don't think it did anything to increase their love of their parent's faith at all or strengthen it.
That's my approach for now... anyway.
I figure by talking now... gently, and without "ruining their fun"... I may get more.