i say this for funnies but i really did explain IP addresses, domain names, and ports to them. the easiest metaphor is a building. a building has an address, a name, and several floors.

this building is at 390 park avenue (ip address)
it's called "lever house" (domain name)
there's a restaurant on the 3rd floor (port 3)
there are offices on floors 4-12 (ports 4-12)

or maybe i just make them watch Hackers again.