Kid in stories not exactly well-behaved, for example (7)
I believe the answer is:
litotes
'not exactly well-behaved for example' is the definition.
(litotes is the use of sarcastic understatements)
'kid in stories' is the wordplay.
'kid' becomes 'tot' (tot is a kind of kid).
'in' means one lot of letters goes inside another.
'stories' becomes 'lies' (I've seen this before).
'tot' put within 'lies' is 'LITOTES'.
(Other definitions for litotes that I've seen before include "no overstatement" , "not exactly truthful, for example" , "Possibly, no small surprise" , "No exaggeration" , "No little pain, say" .)