You have some good ideas - so happy to see you are doing the small at-home party instead of the mega-parties with 25 kids! Keep in mind that musical chairs gets kind of boring for the first few kids after they are out, so consider eliminating the game or giving the job of stopping the music to one of the "out" kids.
You can get some old pillowcases from the closet or the discount store, and have races outside. Also consider getting some plastic eggs and putting the prizes in those, hiding them outside, and letting the kids have a treasure hunt. Plastic eggs are available year round at the dollar store and the party/craft stores. You can give each kid a color and let them find their own color as well as help others if you want to really keep it even. We used the prizes instead of separate goody bags.
Since they are old enough to read, you can also hide prizes around the yard and give each kid (or groups of 2) a set of clues to direct them to the hiding places. Use eggs or little ziploc bags (you can put them out the night before and they'll be protected from rain or dew). Sometimes we did little rhymes (if we had enough time) and other times we just gave descriptions. Good hiding places are the notches in trees, rock walls, rain gutter down spouts, a coiled hose or hose caddy, clipped to a shrub with a clothespin, the mailbox, flower pots, between the screen door and regular door, in a fence, etc. Scout out some locations beforehand and write up clues. If you give each group of kids different clues, everyone gets something, and at the end they can help each other find the remaining treasures if some clues were harder.
I also think kids just like to run around and don't necessarily need endless activities with rules. They have structure all week in school and don't necessarily want to spend their weekends being directed from one activity to another. That's why we liked the treasure hunt thing - it was a game and a lot of running around all at the same time.