I think it's so individual. Our kids are 9 and 6 and we are quite permissive I think - they have a tablet each and most often use that to play Minecraft together (they don't have log ins/can't play online, but Minecraft allows you to play together if there are two of you on the same wifi network). They also have some "Timewaster" type games but get bored of them quickly. I quite like Minecraft as they build nice stuff together and some of the mods are quite fun and educational (e.g. DD recently downloaded an ancient Egyptian world as she was doing Egypt as a topic at school, and there are some quite nice ones with animal facts or bits of mythology woven into them). They do also just build traps and houses and stuff for each other and prank each other - but I think that's quite fun too and a good way to relax.
However, they both would play for too long if left to it (or watch endless hours of YouTube of people playing Minecraft). On weekdays we're just too busy for them to go overboard - between school and clubs and homework and eating meals and other random projects they want to do there's not a lot of time left. There have been times at weekends when we've been getting on with DIY, or times the kids have been off sick and I've had to work that I've let them have too long and it does make them a bit wired and grumpy, or they start to get frustrated that builds aren't working out how they wanted, so there definitely is such a thing as too much. I'm keen that over time they learn to self-regulate on this stuff (as I largely did - though I'm still guilty of spending too much of my own time online at times) - but at ages 9 and 6 they certainly need some boundaries. In our house that tends to take the form of "you've spent enough time on that now - have another 10 minutes and then we're going to go and do something else" and generally that goes down fine - I think they can kind of tell themselves when it isn't doing them any good any more and not actually helping them relax and they are pretty open to stopping as long as we give them a little bit of warning.
The other game I quite like is Pokemon Go, which is on my phone and I let them play on our bus commute to school once they've done any times tables/spellings we need to get done. It's not a very improving game by itself but the elements I like are (1) that it incentivises you to actually walk off your route (so e.g. sometimes we get off the bus early and walk the rest of the way home to try to catch a Pokemon that is a bit off our route), (2) that the Pokestops are points of interest, so it causes you to stop and notice a little plaque to a historic event or a piece of art somewhere, and (3) that you can "save up" coins to buy things like extra storage space (or fritter them on lower item things like clothes for your avatar). DD (9) is a natural saver, so I worry less about her, but DS (6) is a spender and I think it's quite a good way for him to start to learn that if he spends all his "money" on clothes for his character then he can't get a bigger Pokemon storage or something that might give him more pleasure in the longer term. They also learn negotiation as there is only one account that they take turns on, so they have to agree how to spend the coins! I enjoy them having the opportunity to teach me about something they know more about too - it leads to a lot of fun conversations.
I think "money" in games is a tricky one as you don't want them playing for hours to try to generate coins - but in Pokemon there's a (fairly low) limit on how many you can get a day - and you can basically generate that through one action - so I don't worry about it generating that kind of obsession with the game (and in fact when they are on holiday from school we often don't play at all for long stretches). At some point I need to actually give them pocket money so they can learn these lessons with real cash!
Anyway, as I said, I get the impression I'm more permissive than most on this thread and maybe too much - but I do also see some advantages in giving them some space to go a bit "overboard" and learn to self-regulate as they get older. In the end I tend to believe that people with addictive traits will find a way to express that in one way or another, and will need to learn to regulate it in one way or another - it isn't possible to protect somebody from all addictive substances for their whole life long. It's certainly reasonable to protect young children from those things until they have the skills and level of development necessary to learn to manage those traits - but once they do have those abilities it's probably best to start to learn to apply them in "baby steps" and in a home/family environment, within some safe limits, rather than as an adult and entirely on their own. I think most areas of parenting are a judgement about what your child's personality is, where their skills are at, and at what point you start teaching skills and exposing them to challenges that they will need to face to thrive as an independent adult. I need to judge whether they are ready for a certain level of exposure to video games just as I need to decide whether they are ready to try a certain book or movie. There is no one "right" answer, and the "good enough" answers will vary for every child.