Fencing the entire backyard is much more desirable asthetically and for the convenience of day to day operation. There are ways to protect your children such as Power safety covers, door alarms, gate alarms, pool alarms, etc. without damaging the ambience that everyone desires with a residential pool. You certainly don't want to feel like you are walking into a hotel pool. I know it may not be a concern now, or so you plan, but when you decide to sell your home a pool that creates a private backyard paradise helps resale value immensely. Just watch a program like House Hunters and see for yourself.