Since these children are obviously loveually aware, they should learn the pleasures, dangers, and safety precautions associated with love. Also, while they may be just experimenting, they should know that incestuous behavior is not tolerated by society. While they may not agree with this, and it is their right to do so, they need to know how they will be treated if they continue.
Also, since you are still very young yourself you may not be the one to explain things such as this to them. Unless you know for damn sure that their parents are understanding of this kind of behavior I would avoid telling them at the present. If their relationship continues and causes any problems you may need to come forward though. Just try and find someone knowledgeable and understanding to discuss this with them before doing anything that would only result in punishment.
That's assuming this continues for an extended amount of time. I fooled around with my cousin several times for about two years, when I was between 10 and 12, but would I do it now? Hell no. *shudder*
