I don't own a pet rabbit, but I do know of many people who have. They are usually kept in cages indoors (probably due to the long Canadian winters we have). However, they were often brought out and ran happily around the living room. They can be litter trained, so as long as you have a litter box out for them while they are running around, you don't have to worry about finding little messes everywhere.
One of the most important things to consider before buying a pet is how it will fit into your lifestyle. Are you willing to spend the time to train and bond with your new pet? Will you be prepared to take care of the rabbit if the kids lose interest? Pets can be a wonderful experience, and help to teach responsibility to children, so I do encourage that if you are prepared to put the time and money in, you will be happy you did so.
Cheers,
Lindsey