Some set of hiring managers assumed a mother with kids would likely focus more on family then career. That assumption may or may not be dumb. It's certainly correctable if there is serious statistical evidence it is wrong (unlike someone just being a bigot).
That wouldn't help this case though, because the inclusion of kids in the resume was an intentional signal that mangers were meant to interpret as such. Since the applicants gender was misread, the signal was read as they wanted flexible hours, not that they were stable. Sure, dad's could ask for flexible hours, but that is on the whole a less frequent occurrence.
This is an even stronger single because asking if I have kids in an interview is in fact not legal in most places in the US, so including it your self is making a huge point.
Oh, there's also the fact that if you did interview them and not hire, the fact that it was in their resume might give the grounds for sueing you for gender discrimination.