You shouldn't just consider the monetary value, either. Your mom's vintage costume jewelry and evening gowns may make great dress-up pieces, but will your daughter value them more when she's eight or 20? The ability to appreciate and care for heirloom objects is the biggest consideration here, and it can be a tough call. Most children aren't mature enough to enjoy heirloom pieces for more than their functional value until they're in their late teens, if then. Once they reach their late teen years, their ability to treat heirlooms with the respect they deserve is a matter of individual temperament.
This is particularly true of items that have a high monetary value and are easy to sell. If your son wants a motorcycle more than he wants to be the custodian of your great-grandfather's pocket watch, he may not be able to resist the urge to trade one for the other. In 10 years, he may regret the decision, but by then, it'll be too late. Keep the watch until your son is more mature. When will that be? You'll probably know when it happens. He may get married and become more interested in family life. He may start asking family-related questions and expressing an interest in his roots. Watch for the signs, and present him with the watch then. He'll appreciate both the watch and the gesture more once he has the life experience to value what they represent.
You want your kids to embrace their heritage and the memories of family members preserved in some of the objects they've left behind. That's weighty stuff. Before you bestow the honor on your children, recognize that it also carries with it a burden of responsibility they should be mature enough to bear with grace.