Its not so so wrong at all. A holiday is for the kids too as well as the parents, and if the kids want to stay up then why not let them?
We let our two (they'll be 12 & 5 this year) stay up until we go to bed. The eldest plays football or hangs around near us, the youngest stays next to the stage, dances, sings and generally enjoys herself. I wouldnt dream of putting my kids to bed or taking them up to our room when there was still entertainment going on downstairs and other kids still up having fun.
Our youngest will generally have an hour or 2 sleep on an afternoon so she can stay awake at night for the mini disco etc, our eldest is old enough to not need a sleep so we dont have a problem, we stay downstairs and have a few drinks, that doesnt mean to say we force the kids to stay up so we can get trolleyed!
Lighten up will you.....times are changing, we're not still in the 1960's at prison, sorry, butlins camps in case you hadnt noticed, set bed times are for school nights, not for holidays