A rare term that appears to be a reference to the Children of Ilúvatar, Elves and Men. In fact on the very few occasions it is used it always applies to Elves (for example, Lúthien is said to be the fairest, and her father Thingol the tallest, of all the Children of the World). The context here is slightly ambiguous, but it seems to imply that Men were also included, so the implication seems to be that Lúthien was fairer (and Thingol taller) than any other among Elves or Men, rather than merely Elves alone.