Scanner, I want to make it clear that I don't think you or your wife should feel bad as parents.... No parents ever plan for their children to get hurt, and for better or worse, regardless of the rhyme or reason, these things happen sometimes....
I also want to make it clear that although I love my kids very much, I'm not exactly a model parent or anything.... So, please take this advice for what it's worth.
I try to teach all my kids (even my girl) the following:
1. It's OK and it's normal to be scared. Everybody gets scared, including me.
2. Unless you're wrong, it's OK to stand your ground. In fact, you should do so, no matter how many times someone knocks you down.
3. Unless you're wrong, to never take a hit or even a nasty word from anyone. Fight back if you have to.
The basic goal is that I am trying to help them develop an unwaivering sense of inner strength. You see, shiners will heal, but the psychological damage from such incidents is something they can carry well into their adulthood.... Taking a hit isn't physically as painful as it is to associate it with a sense of loss or defeat, and again, such sentiments can negatively impact their development.
As parents, we must never let that happen.
Now, this is the part that maybe I won't win Father of the Year award,
but they need to understand that it's actually... normal... to get beat down sometimes. Like being in a car accident, you hope it never happens, but deep down and no matter how much we may want to deny it, we also know it will probably happen sooner or later. Therefore, I think it's ridiculous to try to shelter children from ever being picked on or hit. Face it: Even as adults, they may run into that.
And when it does happen, they need to fully understand that it doesn't mean they are any less or weaker as a person. In fact, any fool can throw a punch, but it takes strength to take a hit and remain resolute as ever, if not more so. They also need to understand that a punch can never break one's own inner spirit. That is something only we ourselves can break, and ONLY if WE choose to do so. Not them.
That said, it would also be wise to try to evade a hit all together.
Fight back as a last resort, but if it comes to that, don't hesitate and don't hold back.
In practical terms, sometimes my kids fight each other. Rather than just breaking them up, I try to turn it around into a lesson in conflict resolution. I suggest ways that they can settle their disputes diplomatically, chastise them if they are unjust, and praise them when they are justly standing up for themselves.
Perhaps most important of all, I also encourage all of my kids to stand up to me.
For most children, I think the father is typically the most imposing figure at that point. Not just that, but I can be very fierce, and they are aware of my training as a fighter. So... I guess I can understand if they are a little scared of me sometimes, even though I don't try to scare them or anything.... So, if they can learn to stand up to me, I believe they will do just fine when they go out into the real world. After all, the conflict resolution strategies you learn growing up are often times what we rely on as adults, even if they are more refined and sophisticated.
When I share these lesson, I'm never deliberately harsh or cold towards them, trying to force them to be "tough". Rather, I always try to be as comforting and compassionate as I can when explaining these things to them. I believe telling your kids how much faith you have in them is far better than trying to scare them into being "tough" somehow. True inner strength comes from caring for someone, not fearing from them.
Anyway, like any other parent, I do the best that I can and hope that that will be good enough. I'm rambling, but hope that may have helped somehow.