Sorry, but Gamepass is better. I had both services for a while:

With Gamepass, you’re guaranteed to be able to play first party games. With PS+ Extra, you pray Sony puts their games up and then you pray they don’t take them down. Case in point, Last of Us 2. It went on Extra for 6 months and then was taken down so they could force people to buy the Last of Us 2 remake when it releases 2 years later…

Gamepass has a really diverse set of games. They’ve put in the effort to make sure every genre is represented and they have a lot of games geared towards kids. No one is denying Sony has a bunch of great exclusives, but if you want something besides 3rd person cinematic games, there’s not a lot of diversity.

What console your friends have is definitely the way to go if you’re going to be playing multiplayer games. Your kids are pretty young, so I’m not sure if that’s a huge issue yet.

Beyond that, I’d recommend the Series S/X for Gamepass. You said your kids are new to non-Nintendo systems, so there’s probably a lot of games they/you will want to play. In that scenario, the subscription services are the perfect option. Gamepass is simply better than PS+ Plus Extra. One of the things it does better is diversity, which your kids will appreciate coming from Nintendo.

Either way, I don’t think you can go wrong. Fist party output has been abysmal for both Sony and Xbox so far. Third party is where it’s at.