What is completely wrong about this situation is that of course you are correct, there is no way for the bus driver to monitor anything about the students in the back of the bus. The bus driver is busy, driving the bus and their attention should be wholly on the road ahead. If the bus driver is noticing an 8yr old sitting quietly reading, then he is not paying enough attention to that road..
What is needed here, is not any kind of stupid rule saying that they can't take 'things' out of their bag, but a student supervisor on the bus. If students are actually jumping around then the supervisor needs to stop that.