Our church runs a youth league for the community. While we do not require anyone to sign a behavior statement, I am intollerant of negative comments. I will and have thrown parents and coaches out of the gym. Positive encouragement only, and nobody speaks to my youth ref's!
We don't change the rules as much as others have suggested, but in our 8-10 year old league I tell our ref's to not call any "dexterity" violations. That means we ignore the travels at the beginning and end of each dribble, the bunny hops on shooting, etc. Our 3-seconds is at least 5, although not specified that way in the rules.
Many parents tell us we run the best league in the area. I think the point is by our focus it meets their desires better. If you read our rules (
http://r.ogg.home.att.net/YBLRules.htm) you will see that we have no substitutions; players substitute between quarters only (OK, a few exceptions you can read).
I don't eliminate zone defenses because each team has players who have no clue what they are doing. A zone defense allows a coach to position them in a less critical area while they learn the game. IMHO man-to-man can really cause a game to flop if there is a real hot-shot on the court that no one player can defend. Even in the younger ages, we have some of those.
Good luck!