I agree with the 5-star review - this is suitable for modern children.
It's restrictive, and unnecessary to assume that children only want to read contemporary stories. Children's imaginations are timeless, and classics that endure like Alice In Wonderland, Narnia Tales, and this book, do so because they capture and encourage imagination. Indeed, the current trend for Harry Potter surely shows that a book doesn't need to be contemporary to appeal to young readers. In fact, I'd say the opposite is often true.
I discovered Phoenix and the Magic Carpet when I was about 8 - I can remember seeing the wonderfully stagey BBC adaptation, and nagging my Mum for the book. It's a fantastical tale - of flying carpets, magic lands, and mythical creatures. Back then, I was also hugely taken with the Edwardian setting of grand houses and nurseries. It added to the sense of mystery and other-worldliness.
I still have my old copy - a little dog-eared but much-loved - and I'm really looking forward to sharing it with my niece as she discovers books. I'm sure she'll love it as much as I did.