I'm not intimately familiar with CDG, but I think if the first flight arrives on time, there's a good chance you can make it, and you should hustle.
If the flight is *one* minute late, then the itinerary has broken the MCT and DL/AF pretty much has to help you. Not to say that they wouldn't help you if you arrive on time or slightly early, but you have a stronger case if actual connection time is less than that 60m MCT. In theory anyway!
At the end of the day, I wouldn't worry about incurring extra expense to get to FCO, especially since you say you have trip insurance. I would be surprised if you have to split the family up on different flights, and I think the most reasonable "worst" case is you don't get seat assignments together on the rebooked flight.
FWIW, I recently missed a connection at CDG on AF (was originally a 1h55m connection; we might have been able to make it but I didn't want to run...), and the AF staff couldn't have been more gracious or accommodating. This was in first class though.
