Engage yourself in what they are doing. Describe what you see. Tell them what that makes you feel. Be objective, rather than judging of their performance.

"You have been trying to find that bug for hours. That's true perseverance!"

"I like the sound effects you added. They really draw me into the game even more."

"It sounds like you're using a technology you haven't before. Trying is the only way to learn new things."

"This runs so smoothly!"

Also, ask questions.

"How did you get the enemy to follow my character?"

"I feel like the game is unfair when I die here. Is there anything you can do to make this section not so difficult?"

"I understood what I was meant to do right away. Can you think of why that was?"

Note how you don't even have to be positive when you do it this way. Simply sharing the experience goes a long way. Encouraging critical thought and decision-making makes it even better.