“MUM,” said my daughter, Ellie, 20 minutes after arriving at Reid's Palace, as she swam around a huge bath. “When I get out the bath I will want my dressing gown and slippers.” Reid's has turned an ordinary four-year-old into a princess.

After more than a century of catering to elderly European royalty and dinner-jacketed statesmen, this staid old queen of the luxury market has cautiously opened its doors to families.

Being Reid's, it doesn't stint on the little extras: children's bathrobes, slippers, teddy bear soaps (and sweets), colouring pencils, and even a Reid's teddy on the bed for younger customers.

Meanwhile, the new spa promises parent-and-child massages, and a children's club offers face- painting, Lego (and, sometimes, tours of the hotel kitchens), for children aged from 3 to 9.

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What Reid's does, it does so well that it seems churlish to sound a note of caution, but I must: this, despite all the best efforts of the Orient-Express group, is not a hotel for children.

That fact was made clear to me at breakfast on the first morning, in a stunningly bright and beautiful glass room, when I found that I was in possession of the only child in the hotel.

It was a bit like the scene in Chitty Chitty Bang Bang when the children arrive in Vulgaria; a roomful of expensively made-up eyes turned on the child, faces registering at best surprise, at worst downright distaste.

I quickly understood why: the sort of hushed reverence with which guests at Reid's treat even their breakfast routine simply does not allow for spilt orange juice (served in wine glasses) on crisp bright linen tablecloths, or a howl of protest at not being allowed to stick fingers into all the little jams. You can get a glass of champagne at breakfast; you cannot get a tumbler, let alone a plastic cup.

“Mum,” said my daughter, on our second day there, “I think England is a kids' country, but we don't mind having adults. Madeira is an adults' country - but they don't mind if I'm just one kid.”

And just one kid she was. By now another pair of children had checked in, a couple of princess sisters, perhaps 8 and 10, wearing identical designer clothes, jewellery and jaded faces. I never once saw them smile.

Madeira is an adult's country: steep, mountainous, with unreliable weather, a chilly sea and no beaches to speak of. It rises, verdant and vertiginous, from a deep blue Atlantic, 360 miles (580km) off the coast of Africa and 500 miles from Europe. Its main attractions are a network of winding mountain paths and plunging cliffs.

Reid's Palace is high over the harbour of the capital, Funchal, which opened in 1891 and still hums of Empire (it would never shriek), with its luxurious public spaces, sumptuous decor and exquisite, black tie service. You don't have a cup of tea at Reid's, you have Afternoon Tea. Each Saturday night the mirrored Edwardian dining hall tinkles to the genteel sound of the “world-famous Reid's Dinner Dance”.

What the hell, I thought, and gave it a go. Within minutes I was accosted by a guest in black tie. “I,” he said importantly, glancing at Ellie standing rapt by the pianist, “paid a lot of money to come here for a honeymoon.” Admittedly her waltzing wasn't up to much, but the tail-coated waiters couldn't have been more welcoming, and one even kindly danced with a four-year-old.

And that is typical of Reid's: while the staff bend over backwards to welcome kids, within the rather strict rules that apply throughout the hotel, the guests fall into two categories: those who do not mind a well-

behaved child as long as it doesn't make a noise around the pool, and those who think that a child has no place at Reid's. They might call certain restaurants informal, but that's grown-up informal: pressed trousers and a tieless shirt, rather than wet swimmers and bare feet.

The hotel thrives on its snob appeal, with a website boasting of a dining room “known as the House of Lords because of the number of British peers who dined there”, and brochures listing all the European royalty to have graced its doors. So its welcome to children is ambivalent. The staff do a magnificent job of treading carefully around the competing interests of posh pensioner versus parent, but it is the kids who get squeezed out. A battalion of rules ensures, for instance, that there is no children's food by the pool, without special permission from the management; no dinner before 6.30pm, except in your room (where children's steak and chips arrives on a heated trolley covered in the ubiquitous white linen tablecloth); no shorts or T-shirts at tea; no sandals in the restaurant - at Reid's, you show up for it, they have a rule for it.

The kids' club is a rather desultory place, but perhaps that was because there were no children there. Its indoor space seemed smaller than my bedroom, the outdoor play area was lazy and plastic with the exception of a beautiful little paddling pool. You need a bit more for young children at Reid's because Madeira doesn't really have beaches - one black one, and an artificial golden one, and Reid's is as far as it could be from them both - yet all the other pools in the hotel are a minimum of 1.1m (3ft 6in) deep, which is too much for small, unaccomplished swimmers. And, of course, they do have to be quiet.

For those who really want their children to experience this sumptuous hotel, I would point out three things. First, the staff will do everything in their power to make you feel comfortable, and they told me there could be up to 40 children there during school holidays, which must change the hotel's character considerably.

Secondly, Funchal, the town just below the hotel, has a vast range of child-friendly restaurants: try the Regional near the cable car for fish so fresh it was twitching on the ice, or Riso on a cliff top in the old town for traditional rice dishes. And, thirdly, Reid's has one unique, to-die-for offer: the parent-and-child dual massage in the new candlelit spa, in a massage room with its own terrace and private hot tub overlooking a gently breaking sea.

I had a truly gorgeous treatment - and I'm a fussy customer - combining Thai massage with herbs and heat. I needn't have feared how Ellie might disrupt it; she is her mother's daughter. Ten minutes into the “Angel Bliss for Children” she was asleep, bum in the air, and stayed that way until the end, when she woke up protesting that it was boring. “It was a bit calm,” she tried to explain afterwards.

You see, if you do have a little princess, she will find all she needs at Reid's. If, on the other hand, you have a bog-standard kid, they may find this grand old lady just a tad staid.

Need to know

Alice Miles travelled with Prestige Holidays (01425 480400, www.prestigeholidays.co.uk), which offers four-night breaks at Reid's Palace (www.prestigeholidays.co.uk). They stayed in a Junior Suite costing from £1,343 per adult and from £166 for onechild (under 12, sharing with two adults); the cost for a child sharing with one adult is £1,325. One adult and one child sharing a Classic room pay from £732 and from £713 each. Prices include breakfast, flights from Gatwick and private transfers.

Spa treatments 50-minute Angel Bliss about £60; 90-minute Samunprai about £97.

Child-friendly restaurants Riso (00 351 291 280360); Regional (00 351 291 232 956).

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