All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad, sallallaahu ‘alayhi wa sallam, is His Slave and Messenger.
We ask Allaah, The Exalted, to reward you and enhance your piety and righteousness for quitting playing chess and not selling the chess sets to others. Playing chess is considered a doubtful matter, if not unlawful. Many scholars - including the four Imaams (i.e. the founders of the four mainstream schools of Fiqh) - have held that playing chess is either prohibited or strongly disliked. In fact, this is enough to deter a reasonable, pious Muslim from playing chess. The scholarly difference in opinion regarding playing chess is, of course, when it is not played for money, i.e. gambling, or when it does not constitute committing religious prohibitions or neglecting obligations; otherwise, playing chess would be deemed forbidden unanimously. Generally speaking, a Muslim's time is too precious to waste on such futile activities and his religiosity is too valuable to be undermined in such a manner. For further information, please refer to Fatwa 85615.
There is no harm for you to use the wooden chess boards in that which is lawful and to give the chess pieces to young children to play with them. The toys with which children play are exempted from the prohibition of statue-like three-dimensional figures; they are deemed lawful due to need. This is evidenced by the Hadeeth of ‘Aa'ishah when the Prophet, sallallaahu ‘alayhi wa sallam, approved her playing with dolls; please refer to Fatwa 81999.
In principle, it is impermissible to own statue-like three-dimensional figures according to the religious texts reported in this regard and this applies to the chess pieces that are of human or animal shape. Scholars underlined that it is impermissible for a Muslim to own such figures unless they are not revered and respected and are used by children and the like. The rationale behind the prohibition of such figures is that they are imitation of the creation of Allaah, The Exalted. For further information, please refer to Fataawa 83314 and 92512.
Finally, we could not find what you have read about Ja‘far As-Saadiq regarding the chess pieces in our references. If such an opinion is authentically attributed to him, perhaps he was referring to the prohibition of owning statue-like three-dimensional figures of human or animal shape, which is the reported opinion of the scholars in this regard, as highlighted above.
Allaah Knows best.