as someone whos parents did this growing up, (we called it the halloween fairy) as long all you have to do is give the kid the option. i loved candy but given the choice i would always rather whatever toys the halloween fairy would bring.
Current neurotic parenting thing is the "switch witch" where kids will leave all of their Halloween candy out for the switch witch to come and take it and leave a toy or other reward in its place. Which seems like a very roundabout way of giving your child an eating disorder