It is my experience that families can adjust to any space that meets their basic needs. My father's family traveled several years in a Model T touring car with tent, moving from job to job during the Depression. Three children at the time, they all turned out OK. They all had jobs to do and grew up with a great work ethic and strong self discipline.
In the low cost county and municipal campgrounds I often use, I meet families full timing with 3-4 children in 22-25 foot travel trailers. Maybe it is not as nice as a 3000 sq ft McMansion with separate rooms for each family member, but it works for them.
The lifestyle probably works a lot better for the children than it does for whoever serves as homemaker. For the youngsters constantly moving, spending time outdoors, is a great adventure. Compressing your lifestyle to a small space can be more difficult for a homemaker already accustomed to the luxury of larger spaces with dedicated uses. On the other hand, there is a lot less house to keep clean, in a RV.