Youngsters Don't Need Much
Welcome aboard the RoadTrip America Forums!
Your two children won't need much in the way of 'attractions'. In fact, paying for them to enter anywhere would basically be a waste of money. The infant won't notice and the two year old won't really care, (s)he'll be just as happy running around in a park beside a lake or stream. On the other hand you certainly don't want to drag them through 'stately mansions' even if that's what you had in mind for the adults. The kids will get restless and spoil the experience. So I think what you should be looking for are natural settings every two to three hours along the route so that the kids can get out and play and the adults can relax.
You should also plan on taking two days if you can. While you could make the drive in a single day if you stuck to the Interstates and made minimal stops, the drive will be much more pleasant if you take your time and spend some quality time outside of the car. Making the overnight stop means that you can take some 'roads less traveled' and actually stop at a few places of natural beauty as well as the odd 'attraction' that catches your eye.
For a basic route, then, you might want to look at using US-9/NJ-33/NJ-31 to split the difference between New York City and Philadelphia to the southern end of the Delaware Water Gap. Then take I-80/I-380 up to north of Scranton and get on US-6 across northern Pennsylvania to Towanda and then take US-220/NY-17 up to Elmira/Horseheads. From there, take NY-14 u to Watkins Glen. One last possibility for a stop on the way to Niagara would be Letchworth State Park, but that would require a bit of navigation to include efficiently between Watkins Glen and the Falls. Using the above general routing, a midpoint for an overnight stop would be around Towanda PA.
AZBuck