Don't mess around, take a cab
I have lived in East Harlem for several years and love it here. However, arriving after midnight with a family and luggage? I would urge you to take a cab. The cab should only be about $7-9 US from the 125th street A train station to your hotel on 120th. If you were arriving earlier I'd suggest you walk, but you're getting in late at night. That's different.