Personally if it is for your kids, get a wii. Some of the shit kids have been saying on XBL playing MW2, I wouldn't want anybody under the age of 18 hearing it.
I have an XBox and the 'friends' thing is fairly important to me. Basically, everyone else has one. The Ps3 seems technically superior, but I'd have no-one to play MW2 with. psst- MW2 has a 'mute' button. You don't have to hear what people are saying.
The new 360's are more quiet and RROD seems to be closer if not within the norm for industry standards while PS3 YLOD is making a little more noise but again thats probably with early batches not the new slims. PSN is free but 360 seems to get more exclusive DLC or gets it first plus 360 can get some demos first. 360 has more exclusives and 3rd party do prefer the 360 so maybe sometimes the PS3 is out in some ways even for cross console games. However the new slim is the perfect PS3 and with the controllers that don't need battery packs brought for em is a big plus for PS3. With price not as big as factor as before though 360 is cheaper and M/S are kinder to broken consoles than Sony the main factor will be games. Metal Gear and Uncharted are the biggest Sony draw's IMO and Uncharted 2 is really really good. Mass Effect and Halo are the top ones that come to mind though Alan Wake soon is 360 exclusive. Both would be ideal other than that it comes down to games you want to play.
It should be said that MW2 has an ESRB rating of 17+, a BBFC rating of 18, and a PEGI rating of 18+. You're right though in that there is a lot of bad language on XBL. I suppose it requires a wee bit of parental supervision.
The worst are the 12 (or so) year olds. This one little kid with a southern accent must have used the 'N word' at least a couple of dozen times in a game I was in the other day. Makes you wonder about his parents and the kind of people he hangs around with. Little racist SOB..
For kids your age, I'd highly recommend a Wii. It's basically a kids console, nearly all of its games are geared toward children. They'll have a lot more fun with it, since it's much more of a "toy" than the 360 or the PS3. When they're older (say 15-16 or so) they'll be ready to "graduate" to the more serious gaming system.
For kids it's going to come down to what their friends have. It's really a crap shoot in that regard because you can never know which system dominates a given group. But betting on the numbers it'll most likely be the Wii, with the 360 coming in 2nd. At their age though it would seem that they'd be about to transition from a more Kid friendly console like the Wii, to one that's more adult oriented like the 360. For yourselves I'd go with the ps3, particularly if you own an hdtv and are not really big in to games. Blu-ray, plus it comes with a lot of the stuff you're going to have to pay for with the xbox and has no monthly fees for online play. It's going to require less extra purchases because it comes with things like wi-fi and rechargeable controllers that will cost your about $130 bucks to get separately. And if you do need to get an add-on, like a keyboard, mouse, blue-tooth headset, larger harddrive, ect it won't require you to get proprietary hardware that inexplicably costs way more than it should because the system is the least proprietary one out there. You can also surf the net on the system and it has significantly less failure rate than the 360. If you guys are gamers it comes down to what you and your kids want to play though.