The short answer
Yes. There is no formal age limit, and our camel guide says children from about three or four usually ride, with a parent or in their own small saddle. The camels are calm working animals. For toddlers, or a long ride to camp, a 4x4 transfer is easier, and Agafay is a gentler first desert for small children.
In more detail
The walk itself is slow and steady, and children usually love it. The moment to watch is the camel kneeling and standing, which tips riders forward and back sharply. Hold younger children firmly, or let them ride in front of an adult. The guide walks alongside the string the whole way.
Think about the trip as a whole, not just the ride. Merzouga is 3 days or more from Marrakech, with long days in the car, and nights are cold from November to February. With small children, Agafay gives you the camel ride, the sunset and a camp dinner about 40 minutes from your riad.
If you do go to Erg Chebbi as a family, ask for a camp close to the dune edge, so the ride is short, and a family tent. Bring sun hats, warm night clothes and a torch each, and a small bag of snacks: dinner at camp comes late by children's standards.