One of the first entries I ever did on this blog concerned the benefits of small-city living, seen from the perspective of an individual looking to establish some social capital. The basic idea behind it was that a city is going to offer a lot more than a small town or village, and it's a small city (100,000 or so residents) that's going to be just small enough to where you can actually *be* someone and not just get lost in the shuffle of a New York, Boston, LA, or Chicago.
Spending the better part of the past week on leave with the extended clan has shown me another small city benefit -- public transportation. When kids are in the age range where they're busy with activities but too young to drive and/or own a car (say, 12-17 years old) it's VERY easy for me to see how the title "parent" can just become synonymous with "chauffeur." But, while they're at that age, that also means they ought to be self-sufficient enough to use a bus or light-rail system when it's available. When you've got that in place, and you live somewhere dense enough where walking is usually a viable option, you make it a lot easier for kids to get around without turning their parents into full-time chauffeurs (which is obviously impossible if they already both work full-time jobs).
Having grown up in a community that had no public transportation system whatsoever, it made getting around a constant challenge, especially when both parents work. And while suburbia's green lawns and bigger houses may be great for the ego/privacy/net worth of the homeowners, I would say that when it greatly restricts anything that kids might be able to do outside the house, it's a very debatable point to say that it's necessarily *better* for kids.
I guess the ideal scenario for large families might be a nice neighborhood with some space that's not too far from downtown (i.e. reasonably walkable) but still within city limits and thereby accessible by public transportation.
Unless, of course, you don't mind chauffeuring.