Well you can do anything from the simple to the elaborate. I’ll start with some simple ideas first in case you are on a tight budget, which with the economy these days I think most of us would like to save money whenever we can.
You could always have little Carnival stations set up just like your theme where children can pick and choose which games they want to play. Of course this might require some volunteers from friends and family to man the stations, but it sounds like you will have a few of those to help you out.
Ring Toss: Get those little craft hoops and Pepsi or Coke liters and the children have to toss the ring around the container. Put a tape line so many feet away and then toss the hoop and if they looped it around the pop they win.
Basket Toss: A basket is placed on its side, on a tilted surface (maybe even at an angle in a chair or counter) and the children have to toss a basket ball into it and the ball has to stay.
Lollipop Tree: Use one of those fake plant trees or you can have someone walk around with an umbrella and lollipops hanging down and tied to it as the lollipop tree (pick a lollipop and guess the color to win) with colors marked on the bottom of the stick and have the lollipops hang upside down so they don't see the colors.
Ping Pong Ball Toss: Purchase brightly colored pong balls from Walmart ($1.50 for 6). Then buy a large foam core board from Hobby Lobby or Michaels. Hot Glue plastic dixie type cups in rows, onto foam core board. Lay board on table, let kids toss ping pong balls into cups.
Water Gun Game: Buy a water gun, funnels, and use liter bottles to make this game. It can be played in a bathtub if you aren’t having the party outside. The first child to shoot water into an empty liter bottle and fill it to a certain line with water wins. Making a small incision in the top of the bottle for a wooden stick to float out with a flag on top and a foam bottom that will rise with the water would signal the winner.
Penny Toss: Put plates on upside down cups of various heights in a roped off area and use “lucky” pennies to toss on the plates.
Fishing Game: Paint a large box to look like a fish tank (complete with Nemo if you want) and cut a narrow strip to fish through. Then craft your fish on them from craft foam and attached paper clips. Tie a large magnet (the local Dollar Tree has some) to a fishing pole and Voila!
A shooting gallery: set up pop cans and give the kids stopper guns to use to knock them over.
Musical Clown Noses: This game has the same concept as musical chairs. Place a pile of red sponge clown noses on a table or on the floor and have the kids walk around them in a fairly large circle while carnival/circus music is playing. Once the music is turned off the kids need to grab a nose and put it on (there needs to be one less clown nose than there are kids). Whoever is left with no clown nose to put on needs to leave the game. The game continues until there is one kid remaining (who is the winner).
Snacks can be anything from popcorn in small bags, peanuts in their shells in small bags, soft pretzels and hotdogs to caramel apples. And you can get box tops from paper boxes (you know the boxes that hold 8 to 10 reams of paper at work?) Flip the lids over, paint or cover with red and white striped wrapping paper, attach a strap from one side of box top to other and load with a concession (your carnie helper will look like the girls who used to sell "cigars! cigarettes!" - to give you a visual). Also Walmart has started carrying the cutest closeable cardboard food containers which you could even put grapes in. They are in the paper plate section near the animal plates they now carry. They have animals on them and the top opens and closes. You can also have colorful balloons and attach them to EVERYTHING. (Walmart carries inexpensive helium tanks for about $19).
Meijer has raffle tickets by their party supplies that you can buy and use for the games. I would send so many in the invitations and then tell the children that they get so many tickets, say five tickets, everytime they sing happy birthday to the birthday boy. Children love having tickets to "buy" things. You could even pass out play money at the door to buy the "snacks." The Dollar Tree has play money for next to nothing. Since you are creating a play world, why not go all out? With three boys of my own I know they love doing things like that.
Now if you want to get expensive you can have the pony rides, a local magician, and call in a catering team. I hope these ideas help. Good luck.