I think it would be ok to let my kids pee in the backyard next to the neighbor's fence
Does your neighbor want to see your kids peeing outside the house?
I have no clue.
It is wrong to let your kids pee outside on others property. You should show them how to do it right in a toilet so they don't become deviants when they grow up.
What's wrong with kids peeing outside?
Peeing outside in not socially acceptable. Kids need to know boundaries and when to not cross them. This urination is not an emergency so they have time to find a proper spot.