Although I get the idea, going all in on the privacy would mean you can never log in with a single account you have since they bind it to your ip and you’ve lost. Also using vpns all the time or tor if possible/necessary. Imo, its far too much work to go full paranoia mode.
So I‘m running debian stable with kde (dont do it on nvidia!) and pop os on a laptop. Firefox, adblock plus and pihole do most of the heavy lifting. Gaming, working and other activities on the same machine works well without vms. I do use vms in specific dev Environments though.
For kids, an immutable distro sounds like a great idea. Good luck and have a nice day.