I agree with not socializing with the clients. We have been invited to a few birthday parties over the years which we have declined to attend due to "other commitments" I tell them I really appreciate the invite and consider it a compliment to be asked but family and other social commitments keep us busy.
I have even considered having a daycare BBQ, but then gave it a good thought and realized the kids would be as disruptive as they are at drop off and pick up knowing Mimi is not in charge of us even though it would still be "my house my rules" disciplining a child in front of parents can raise some parental furor!