I personally use a trailer, though i know others who successfully use extracycles and bakfiets. In any moving car-bicycle collision, there is no meaningful difference in safety. But the trailer is no inherently less safe: its width means in real-world cycling that vehicles actually give me much wider berth; wider also means easier to see. My trailer hauls a lot, too, including groceries and my daughter's bicycle (which she rides while at preschool). all together i usually haul about 100# combined trailer weight.

As for being at car-tire height: tell me about it. When we drive, it's a sub-compact. Every SUV puts us at their car-tire height. But what are you going to do? Become a lemming and keep getting a bigger vehicle than your proverbial neighbor? We made the choice. And then i got involved in my community's political advocacy to help make it safer for regular families to ride bicycles. Community > SUV. You are the community you want to become.

I lock mine up at the preschool, and then commute solo to work. There's a bike rack right in front of the school office with relatively good observation. I thread a long cable through the bolted frame and wheels and couple that to the bike rack. I don't leave valuables in the trailer. All of this depends on your particular situation. If i lived and rode in LA, i might use a bakfiet with a NYC-rated chain. Most good trailers fold up with a little effort. I have been known on occasion to fold mine up and bring it into my office. The whole rig has a rider on my insurance policy.

I think it's important to normalize it. And i also think it's important to make a real attempt to show via example to my kids that there are better ways to live. We make choices for them all the time based on this premise. We're involved in their education and their moral development. That kind of power is crazy, and it makes many of us want them to be better by doing better ourselves.

But safety is important. I avoid the 8am rush and 5pm crush. I either arrange to go earlier or later. I use multiple very bright LED lights on the trailer's rear for increased visibility; i use a very bright LED head lamp, i use an Airzound horn, and i ride ever-aware that someone wants to kill me. Truth be told, this has helped me to be a much better car driver and citizen in general. I also take the lane as necessary.

you might also try the Family and Recreation forum. there are a lot of families that have mulled over the same questions you have here. many of us came to similar solutions idiosyncratic to our particular situations. in every case i know, we are all much happier for it. our kids are happy. it's helped save money, too.

also see if there are other families in your area doing the same. talk with them. in my area there are many such families loosely affiliated with the community groups and cycle clubs that i am a part of.