Personally, I think it would be silly to buy expensive designer stuff for kids, because kids grow so fast and are generally very messy little creatures, anyhow.
I grew up in K-Mart clothes and hand-me-downs and it didn't hurt my character or self esteem any, and if/when I have kids, they'll do the same. Well, maybe some Old Navy Kids' for variety. I'll probably make a lot of their clothes, at least while they are young enough not to grizzle about not having the same brands of crap as their schoolmates. And when they get into junior-high and highschool, and start getting brand conscious, I reckon I will do the same as what my mom did and tell 'em they can have one pair of expensive jeans or three pair of regular jeans. I seriously doubt that I'll ever be at a point financially where $150 bluejeans are considered reasonable and affordable schoolwear.
My rule for younger children's clothes would be NO LABELS! That includes "GAP Kids" or "Pooh Bear" or anything else with a brand identity. I won't be advertising fodder, myself, and why should I make my kids be little, silent shills, either. Also none of those horrendous slogan shirts like, "My Daddy Can Kick Your Daddy's Butt." I'd be pretty conservative about licensed cartoon characters, too. Maybe one or two of a very favorite character, but not SpongeBob Everything, or Scooby Doo Everything. I would not stand for my baby being a walking billboard. Plus, too much character stuff just looks cheap and tacky. It's badly made, and most of it just doesn't look that good, anyhow.