It doesn't seem like Steam was really designed with this use case in mind. (There's no such thing as Steam Parental Controls, for instance, although both my Xbox 360 and my Wii have parental controls, if I remember correctly.) I've found several threads where people were having similar issues with their kids.

One suggestion was to change the shortcut to Steam so that it supplies a username and password from the command line, like so:

-login %u %p - This logs into Steam with the specified Username and Password combination. Replace %u with the username, and %p with the password you want to login with (Steam must be off for this to work.)

However, this seems like it could be worked around, especially if you tend to forget to log out of steam when you lock your computer. The account credentials might still be cached, and then you'd end up giving your kid access to your games without your knowledge. That's just one possible attack vector, there may be many others, not to mention storing your passwords in this manner is incredibly insecure.

There's also all manner of "free" games that are probably inappropriate for children, but which can be downloaded into any Steam account. Team Fortress 2 contains quite a bit of violence (not all of it cute and cuddly) and bad language, among other things. It's kind of a personal parenting decision as far as what you consider to be "off limits" - but there are free rated-M games on Steam, and TF2 is one of them.

I found this thread over at Gamers With Jobs to be illuminating. They suggested limiting the access rights to certain applications and/or other files (violent games included) using the Group Policy Editor and file permissions settings in Windows 7. This would ensure that your child's Windows account could not access the games in question, even if your Steam account was properly logged in and authorized.

Another thing that was brought up in that thread that I think needs to be said is this:

Whatever barriers you put in his way, are just puzzles between him and the prize, and the more you put barriers in his way the more he will discover ways around them. You're teaching him how to hack in the most effective way possible.

They go further to suggest that in addition to protecting the content, you should also realize that kids with unsupervised access to computers will figure out a way around any level of protection - regardless of how foolproof, given enough time. (I was a living example of this as a child, sorry Mom & Dad!) You might consider putting the machine somewhere public in addition to these security measures, so that it's more likely that their computer time will be more closely supervised.

Don't look at this just as a technical problem that needs a technical solution; it's a complex psychology problem with a technical manifestation.