Way back when we were trying to figure out what family bike to get, we thought that we were looking for a good way to bike with kids. We eventually found it, and love our current set up with an Xtracycle and custom two-kid seat. It works great for carrying one kid, and soon baby R will be big enough for us to use it for two. But it turns out that what we actually needed, even more than we needed to bike with kid(s), was a way to haul cargo.
Getting the Xtracycle itself was actually a bit of an afterthought. At first I thought I was just searching for the right kid seat. But then, after some looking, and riding some standard bikes with kid seats and checking weight limits, I thought that actually an Xtracycle would give us a better ride and more longevity, but I really wasn't thinking much about hauling capacity. I just wanted to bike easily with my kid.
As it turns out, our bike sees much more use hauling stuff (mostly groceries) than it does hauling kids. We don't actually need to bike with our kid(s) that much. We do, at least with the bigger one, and whenever we do, it's a blast, but in terms of day to day life, we really do need the bike to carry stuff.
This certainly wouldn't carry over to every other family, and may change for us once baby R is big enough we feel comfortable with him on our bike. We're set up with daycare and most activities walking distance from home (and yes, that's even 3 y.o. walking distance). However, it does bring up a point for families striving to reduce car trips, but who may not feel comfortable biking with their kids. If you can swing it, it might be worthwhile to work out a cargo set up. It wouldn't have to be fancy. A simple used trailer would do. Any kind of real cargo capacity, the kind that lets you haul a week's worth of groceries, or big bags of kitty litter, can turn errands for which a car used to be essential into bike errands.