Have you decided what to do with Kirby yet? It sounds like a very tough decision. Maybe Kirby will forget about the kids once they've left for a while... have you ever considered getting him therapy dog tested, and maybe taking him to children's hospitals to fulfill that desire to be around kids?

Also, where are you getting your new puppy? Hopefully the breeder has done all of the needed health tests on the parents, and have raised the pups extremely well. Have you thought about buying a purebred Bichon or Poodle from a reputable breeder? just a thought