My now 9 years old son has played soccer since he was 5 years old. Two seasons per year, (spring & fall). The first few seasons the score was not "officially" kept. The idea was that the kids are just learning the game; playing was really just training & practice. But the kids, every one, kept track and knew the score of every game they played. They knew when they won and lost, all on their own, without parents saying anything. Not keeping an official score was not to protect anyone's feelings, it was because the games were really just fundamentals training.
The last two seasons, there was an official score and even a tournament at the end of the season. There was no scoreboard or written record of the score shown anywhere, but again, still, the kids knew the scores.
The scores ranged anywhere from very close, like 3-3, to wide, like 8-1. No one got upset, no kid cried, no parent got angry. Couple hundred kids and parents, and nothing but good manners all around.
He also played a couple extra seasons on an indoor soccer league. In the beginning of one of the indoor seasons, the league official judged his team to be better than his age bracket, and so moved them up. The opposing teams in the upper bracket were full of kids head and shoulders taller than our kids. The game scores were close, but we parents worried about injuries. 7 year old kids playing against 9 year old kids -- a collision, or a ball to the face could be dangerous. There were a couple of accidents that got gasps from the parents on the bleachers. After the first two games, we talked the officials into letting our kids go back down to their age bracket, for safety.
In their own age bracket, our team dominated. I'm talking 20-0 score domination, (in soccer!). We parents admitted to being a bit embarrassed. Sadly, sometimes the other team would have only 4-5 kids, (of 10 total), show up for a game. Our team always had 8-9 show up every game. After a couple of games, our coaches, (volunteer parents), would lend the other teams some of our players to even out the skill level, and to give the other team players time to rest.
Through all of that, still no kid cried and no parent got angry. Everyone was a good sport about all of it.
So remember, for every news item and every apocryphal anecdote you've read or heard, there are thousands and thousands of kids and parents who handle playing, winning, and losing at various sports just fine.
But trophies: some kind of participation award is ok, but a real trophy should be only for winning something major.
Here is more of my experience and opinion on kids' trophies.
Bullgrit