Having had many opportunities observing children (and probably being childlike at heart myself) I've often discovered that once a person's curiosity is sated and "the mystery" is gone, then the issue at hand becomes... well... a non-issue. It becomes a fact of life, and everyone can just move on. It's the mystery of not knowing that makes an issue larger than it deserves to be. Simple, straightforward honesty always has seemed the best policy to me.
Part time is definitely the way to go! Time to be yourself, time to be with your wee one, and a little extra income. Don't necessarily jump into full time employment just because your child is getting older. Once they hit school, they need you just as much (if not more) than when they're babies. If you can afford to continue working on a part time basis, you won't regret not working full-time. A strong, healthy, and happy home life will help ensure a strong, happy, and healthy child... emotionally and mentally, as well as physically.