Here is how the etiquette should work in a civilized society: Take the seat you are given, shut up, and don't bother anyone else. Oh, and don't travel with kids unless you are fleeing a dictatorial regime or relocating for good.
If we all did that, the issue of how to refuse wouldn't be a problem. If there were no kids, the problems of self entitled parents being separated from their crotch fruit and demanding strangers accommodate them would be rare indeed.