I have a 4yr old and 2yr old that both come on the trail with me and my wife. We had the same problem of finding bedding that was efficient. We have a small 3 person tent that we all still fit in (snuggly), so between that and only having me and my wife to haul all of our equipment space conservation and weight were high on our list of needs. We ended up going with two Z-lite Theremarest pads (S) for the ground and I found a camp blanket also made by thermarest that packs very small and is large enough that they can sleep foot to foot. It even has snaps on it so you can create an sort of sleeping bag that is open at both ends.

Theremarest Tech Blanket

Z-LIte Sol Small