As a mom of two 5 year olds and a 9 year old, I know that I have said "no gifts" when we wanted to ask lots of people. There is just no way my kids need 20-plus presents from a party, especially when we are already getting them presents, as are very close friends and family. I see the "no gifts" a lot when a kid wants to ask the whole class. Some of these parties are 40+ kids....no kid needs that much...it is obscene and I think this is what the parents think too. So, I say " no gifts".
Now, if the kid is a VERY close friend of yours or your kids, such that they are together all the time, then definately get a present, just give it to them at another time.
"I may be going to hell in a bucket, but at least I'm enjoying the ride"