I think protecting my kid is minding my own business... douchebag.
I know its part of the survival instinct to protect the young, and I know you really dont wanna hear this from a single guy, but something most parents dont understand is you CANT protect your children. Best bet is to teach them about life and hope to god they make good decisions. Thats their best shot for survival.
Keep in mind theres no such thing as safe and I doubt your neighborhood was truly safe to begin with. You only know about him cuz he was caught and convicted. That doesn't do anything for all the potential pedos running around in town, and depending on how paranoid you are that could be a few or a crapload.
As far as individuals go, please remember that he's registered and everyone knows where he's at. Unless he has a death wish or something he wont go anywhere near the kiddies. The guys you really gotta worry about are the ones who dont register and drop off the radar because the government makes their lives so miserable they cant get by unless they disappear.
Just keep as close on eye on your kids as you already have, assuming you understand they are never truly safe, and maybe one day sit down with the chap and get a feel for his personality. Make it clear you are a concerned parent and your community does indeed watch over its youth.
DO NOT THREATEN HIM!
You dont want a record of your own.