I'd think your idea of getting an in-home "trainer" setup would be just the ticket. It'll ensure you're home more of the time, even during periods when you're exercising. The kids will get a good example of how to keep fit via doing healthy activities. You'll likely be able to get much more saddle time, with a "trainer" setup at home, instead of worrying about being away from home during workouts.

With the fitness up hills being an issue, a good part of that might well be simple leg strength. (Am in much the same boat, with old injuries on the legs that limit my power output.) Could easily get two or three sets of heavier kettle bells (or similar weights) and then doing 3-4 leg-oriented workouts weekly that involve squats, lunges and whatnot. I, too, have a fair-sized hill to get up during each ride, and leg strengthening exercises above and beyond the cycling have done wonders for the overall ability of my legs to tolerate the tougher portions of the climb.