Toronto isn't the safest, compared to other big cities it's certainly very good, but considering the commuter regions have crime rates well below the national average it's certainly better than the other big cities.
The GTA is an amazing place to live. I'm in Halton (which has the lowest crime rate for all the GTA) and crime just isn't considered where I live. I believe the biggest crime in my area is car break-ins in the Cineplex parking lot, which now has a squad car permanently parked there every night.
Considering you can have a job in either Toronto or Hamilton and have a crime rate 1/3 the national average, or a violent crime rate of 1/10th the national average, I'd say Halton is the perfect place for anyone with kids.
Just some additional data on this for interested readers:
Chicago (2.8M) and Toronto (2.5M) are very similar cities, in size and standard of living. Toronto has about 1/7th the homicide rate. In 2008, Chicago had 509 homicides
I am constantly annoyed at all the homicides I have to step over every time I get off the homicide-laden trains in Chicago. I wish they'd do something about it. I see at least three at the Jackson stop every day. Sometimes there are even homicides in my back yard! It takes them forever to pick up, and if you just take them and put them by the garbage cans, the garbage trucks won't take them.
It's almost enough to make me want to move to Canada.
Certainly safer than either LA or NYC, though. One of the safest Canadian cities, actually.