Gareth Southgate said England are "surprised" that at least 35,000 fans will attend Saturday's behind closed doors fixture in Hungary and voiced concerns that anti-racism punishments are affecting the wrong people.
Hungary were initially ordered by UEFA to pay a €100,000 fine and play three games without supporters, with one suspended for two years, following incidents of anti-gay chanting and racist abuse during the country's group stage games at Euro 2020.
That was later reduced to two matches, one suspended for two years, on appeal. This weekend's Nations League fixture in Budapest will consequently take place without any ticket sales.
However, Article 73 of UEFA's disciplinary regulations states that certain exceptions can be made, including "children up to the age of 14 (duly accompanied) from schools and/or football academies."
Sources have told ESPN that Hungary have extended invites to more than 35,000 people -- with one adult accompanying every 10 children -- meaning that the Puskas Arena will be more than half full on Saturday evening.
England are also inviting schoolchildren to next weekend's Nations League home game against Italy at Molineux, a punishment arising from the crowd trouble caused prior to last summer's Euro 2020 final between the two countries, but the FA are understood to be expecting between 2,000 and 3,000 supporters.
Asked by ESPN whether the projected attendance on Saturday watered down the anti-racism message, Southgate said: "I think we are all surprised. But we are inviting children into our stadium so I wasn't really clear on the rules of any of it at the start of all of this.
"I don't know what the figure should be or shouldn't be. Other people have got to deal with that. We've got to make sure that we are consistent in our beliefs, the stand we take as a team, the fact that we are united on it being unacceptable and it is for other people to administer sanctions.
"Once we are administering sanctions, it has gone too far anyway. The key is education. The young people in the stadium hopefully pick that message up tomorrow."
Pushed on whether the sanctions should be tighter, Southgate continued: "It is difficult to know what that line should be because I know we could talk about fines and what would seem like a small fine in our country would be a huge punishment for others.
"We have got a game behind closed doors which costs us millions of pounds of revenue which could go into grassroots football.
"So the reality is that with all these things, the people who are being punished are the players and the supporters who behave themselves and not the people that cause the problem. It is of course very difficult to find a way of not doing that but it is complicated when you get into the details of sanctions I think."
England were handed a two-game stadium ban, with one match suspended for two years, and ordered to pay a £84,560 fine after ticketless fans fought security staff and police.
Separately, Hungary were given a two-match stadium ban, with one game suspended for two years, and a 200,000 Swiss francs fan by FIFA for racist chanting during England's last visit to Budapest, September's World Cup qualifier which ended in a 4-0 win for Southgate's side.