I'm torn on this one personally, just because of the ages – looking at the article, it says that they ride on the pavement, and only cross one major road, where there is a lollipop man, which doesn't seem too bad from a safety point of view, but I think possibly 5 is a bit young to be taken places by not much older siblings – I think I was at 7 before we started going to school alone (we would have been 7 and 9).
I think that is more of a thing than the cycling, which doesn't really seem to add any danger compared to them walking their on their own. I'm not really sure I'd be happy with them walking on their own, although obviously that depends a lot on the kids in question – I've known 8 year olds who I'd happily send down the corner shop (to pick up some fags and booze obviously), but some who are complete space cadets, who'd probably get lost and end up in Scunthorpe (or some other undesirable destination).
Joe