Actually, my father-in-law DID used to say “day-day”, when people said “night-night” to him. I was going to mention “pyjama, pyjama” but I see the OED records this stock response to “nightie-nightie”, quoting the Opies, famed childhood folklorists, as its source, so instead I’ll just repeat one of my daughter’s favourite poems from when she was six:
“Night-night, Knight”, said one Knight. to the other knight the other night.
The reduplication in night-night and bye-bye is clearly originally babytalk, but more interesting, I think, is what might be called “blended” farewell words, such as “cheery-bye” and “tattie-bye” (both in the OED), combining goodbye with cheerio and ta-ta respectively. This seems more “language used with familiars” than “language used with small children” - more informal even than “cheerio”, while still not descending completely from the adult register ...