fighterpilota,
We have a 36' class A gasser, with dual sofas and a dinette. We also tow a Honda Odyssey and are below all chassis weight limits.
Personally, I think anything LESS THAN 36' is too small for what you want to do. We've had 9 & 10 people in our rig for up to 5 days at a time, and we did fine. But this was at a full hook-up site. If we were boondocking, I doubt we would've pulled it off. We did have 9 for a 3 day boon-docking expedition and that worked. From a driveability point of view, if someone can get a 34' DP down the road or into a campsite, I bet they could do the same with a 40' as well.
When we were purchasing our rig, we did look at a 34' dual sofa class A. Guess what? The sofas were smaller than the ones in our 36' rig. They still had 3 seat belts on them, but they were each 4"-6" shorter than the ones in the rig we ended up purchasing. Plus we gained an extra couple of inches of critical kitchen counter space, more room in the bedroom and extra cabinet storage space. (I think, but am not 100% certain, that the dinette was slightly larger (roomier) as well.) Plus, we got larger holding tanks, which is really important with a large crew. So you have to be careful about classifying a rig with "2 sofas & a dinette". There are different sizes.
You sound like you're pretty locked into your plans, but remember that the kids grow, and as they do, you'll NEED more storage space, holding tank capacity, sleeping room, etc. We're thrilled with the floorplan on our 36' motorhome, but I know now that had we "settled" for the 34' version, we would be not be as happy. We would've had to compromise on many areas which I know would've raised the stress level, and thus reduced the "fun" aspect of the trip.
There may be other reasons for not wanting a 40' rig, but IMHO, the excuse that it's not useable but a 34' rig would be, to me, just doesn't make sense.
As for a diesel rig with a gas generator, that, to me would be a deal breaker. Why deal with another fuel? We use our generator a lot and one powered by any fuel other than the chassis engine fuel would be quite inconvenient.
Good Luck in your search, but my vote would be to stick with the 40' rig you've got for at least a year or so to make sure that the concerns raised are, in fact, justified and not "buyer's remorse" or rooted in some irrational feelings.
~Rick
2005 Georgie Boy Cruise Master 3625 DS on a Workhorse W-22
Rick, Gail, 1 girl (27-Angel since 2008), 1 girl (22), 2 boys (23 & 20).
2001 Honda Odyssey, Demco Aluminator tow bar & tow plate, SMI Silent Partner brake controller.