Perhaps it's deliberately meant to be ambiguous.
Certainly there's a recurrent theme in The Neverending Story of ambiguous endings and unfinished tales: just look at how often variations of the phrase "that's another story and will be told another time" are repeated throughout the novel. Ende is leaving a lot to our imagination, deliberately so.
In fact, this fits well with the theme of the story. One of the main goals of the heroes is to make humans start coming to Fantastica again; by exercising our imaginations to finish off all the unfinished parts of the story, we in turn 'enter' Fantastica in some sense. The more time we spend with these characters, in this world, especially when we actively make up stories about them ourselves, the more we contribute to Fantastica. Like Bastian, we can start off by passively reading the story and end up by creating more of it ourselves.
You can you can make your own guesses yourself. Go ahead! Finish Atreyu's sentence, finish all the half-told stories, continue to create Fantasica just as Bastian did.
But what's the actual answer?
The same question has been discussed a lot already by many readers and fans, and there doesn't seem to be a single correct answer. My paragraphs above justify why it's OK for there not to be one, but of course there have been various answers suggested, some more plausible than others.
Let me quote the analysis of St John Karp, a blogger who wrote extensively about The Neverending Story because, in his words, "despite how famous and well-loved this novel is, I have never seen any critical analysis that does it justice". He has a surprisingly negative take on the Childlike Empress:
Here is a ruler who "never judged anyone. She never interfered with anyone ... In her eyes all her subjects were equal ... every creature, whether good or bad, beautiful or ugly, merry or solemn, foolish or wise - all owed their existence to her existence." Fantastica is founded on the co-existence of good and evil - a light snake and a dark snake perpetually eating each other's tail - and an empress who is herself two-faced. For while she has the appearance of sweetness and light, her strategy for ruling Fantastica is astoundingly nasty.
It's certainly true that The Neverending Story has a theme of duality: the two parts of the same story feeding into each other; the black and white snakes eating each other's tails; the constant cycle of the Nothing consuming Fantastica and being beaten back by human imagination; the Acharis and the Shlamoofs; Perilin and Goab; and of course the following quote which feeds directly into Karp's analysis of the story as being about an endless symbiotic cycle of good and evil:
"A hero like Hynreck," said Hydorn, "is really to be pitied in a world without monsters. See what I mean?"
No, Bastian didn't see. Not yet at any rate.
"Monsters," said Hykrion, winking at Bastian and stroking his huge moustache, "monsters are indispensable if a hero is to be a hero."
-- Chapter 17 (Q)
Heroes and monsters need each other, because either one without the other would make for a non-story. Just like Perilin and Goab, or the Nothing and the human arrivals.
Karp says, following the ancient Romans, that there are two kinds of power: authority and influence.
I have cribbed my understanding of power from ancient Roman philosophy. I have no reason to think Ende had the Romans in mind, but they still give us a handy vocabulary for talking about power. The Romans described imperium, which meant the authority to command - when you say jump, everybody jumps or else gets thrown to the lions; and auctoritas, which meant personal influence - when you say jump, everybody jumps because you're a really nice guy and they respect you. Auctoritas was far and away the more desirable kind of power because it meant everybody loved you. Imperium was necessary too, but over-using it was the hallmark of a tyrant. People would soon feel abused and resentful.
Certainly the Childlike Empress uses only auctoritas. Although she holds absolute power in Fantastica, she never uses it in any way, and she is absolutely loved and respected by her people - love and respect which she would presumably lose if she were ever to start using her power as imperium. When Bastian tries to turn to imperium, his best friend raises up an army to overthrow him.
The Childlike Empress won't lift a finger to govern Fantastica. Actually she can't, not without losing her authority and risking self-immolation. That's why she needs Bastian - she can't run the place herself, so she brings humans to Fantastica to do it for her. She acts like a siren, luring perfectly normal humans onto the rocks. But she's more than happy to let these people wreck themselves, she encourages them by giving them a deceptive charter, "DO WHAT YOU WISH". The temptation is to think you can "do anything [you] feel like", but the hidden meaning is that "you must do what you really and truly want". The Childlike Empress is so Janus-faced that she even gives Bastian his very first corrupt idea. It's only by gazing into the Empress' eyes that Bastian gets the idea to change his appearance:
In the golden mirror of her eyes, he saw, small at first as though far in the distance, a reflection which little by little grew larger and more distinct. It was a boy of about his own age; but this boy was slender and wonderfully handsome. His bearing was proud and erect, his face was noble, manly - and lean.
The Childlike Empress doesn't just give Bastian the rope to hang himself, she also kicks the stool out from under him. What a bitch. Well, I say bitch, but we'll never know what the Fantasticans might have called her. Atreyu and Falkor have a fascinating exchange in which they realize that their empress has a darker side, and yet Falkor refuses to speak ill of her:
“Falkor,” Atreyu asked, “do you suppose the Childlike Empress cares what becomes of Bastian?”
“Maybe not,” said Falkor. “She draws no distinctions.”
“Then,” said Atreyu, “she is really a …”
“Don’t say it,” Falkor broke in. “I know what you mean, but don’t say it.”
What word could possibly have finished that sentence? The only one I can think of is "monster", the same word used to describe Ygramul, the sphinxes, Gmork, Smerg, Xayide's metal golems and, by extension, Bastian at the depths of his corruption.
Karp's conclusion is that the missing word is "monster". But in the end, it doesn't matter what the exact word is. It's clearly something negative.
For context, this is during the period when Atreyu and Falkor are beginning to doubt what Bastian is doing, but well before Xayide shows up and they fall out with him completely. They're beginning to turn against what seems to be the established tide of events; daring to criticise the person who, however gently, guides that tide must be part and parcel of the same thought process. And stifling their own criticisms is also consistent with their current state of mind: they haven't really spoken out against Bastian yet, and as Fantasticans they'd be even more loath to speak against the Childlike Empress.