Do you think you'll invent stories about storks and gooseberry bushes or tell them the whole sordid truth or human biology before they're out of nappies? Or just ignore their questions and tell them when they're twenty-three?
Personally I think my own parents handled this quite well and I'd probably go the same route. They never openly lied to me but didn't tell me anything more graphically or detailed than was necessary.
I also had this book called the body book which explained to 5 year olds basically everything about how the human body worked. I re-read it out of curiosity a few years back and it's quite amusingly written
"When a Mummy and Daddy love each other very much, Daddy's willy stands to attention and they engage in a special baby-making cuddle" was one choice quote...