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You heard it a lot. Games are bad. Sports are good. Well, in a sense, yes. But both form the same function in your brain. They are a release valve for your pressured stress. Games form an alternate reality where your brain can immerse itself and get dopamine rushes for acquiring accomplishments. You also absorb all energy of the created reality. If you play a game where women can fight and overpower men, you will be more likely to believe it, or at the very least tolerate it.

This is true for all media, including streaming. Consume bad media, you become corrupt with its trash. Escapism on virtuous media does not make it good, but only makes it less of a problem. A good example of that is how first-person shooters molded people who played them to be aware of how guns worked. This unintended consequence has led to a lot of changes in the world regarding gun laws, and it only didnt get much more lax because there are still people alive who never lived it; the ancient people today lived Woodstock and a forced pacifist trend that will only fully die when they are gone.

Today you must be aware of the problems regarding escapism. Sports and hobbies are the least worst of them, followed by social gatherings. Escapist media is the worst, but on few occasions can provide what other forms dont. Your kids cannot live in bubbles outside their reality. If you raise your kids without the notion of what is a console, a game or modern movies, they will become alienated, and start to question the way you raised them. Homeopathic doses in a controlled environment is preferrable to a complete denial of the existance of the concept.

All things being said, teaching multiple ways of relaxing is the best way. Your kids will pick and choose their own preferred way, and from there its easier to navigate.