Aunt Alexandra is disappointed that the children have been up so late and that they were exposed to the somewhat graphic description of the crimes. She is also concerned that they should have been protected, or more accurately that their innocence should have been protected instead of them getting a clear vision of what their town is really like.
Atticus responds to her by saying that they really ought to get to know what Maycomb is really like. He suggests that he and the other adults "have made it this way, they might as well learn to cope with it." He feels that the children are going to have to grow up at some point and he trusts that they will be able to handle this new understanding of the world and particularly the world they live in.