The sentence indicates that the children were the ones who got cut with the knife. Thus, the answer must refer back to the children and so, the answer must be a reflexive pronoun. 'Children' is a plural subject and so the pronoun must be able to refer to a plural subject.
Option A is incorrect. 'himself' is a reflexive pronoun that is used to refer to singular subjects of the male gender and not plural subjects. Thus, it is incorrect.
Option B is incorrect. 'they' is a third person nominative pronoun and not a reflexive one. Thus, it is incorrect.
Option C is incorrect. 'herself' is a reflexive pronoun that is used to refer to singular subjects of the female gender and not plural subjects. Thus, it is incorrect.
Option D is correct. 'themselves' is a third person reflexive pronoun that is used to refer to plural subjects. Thus, it can refer back to 'children' and is the correct answer.