I think a lot depends on the travel style of your family. Also, check out the schedules for MK and MGM on the two days you would be there to see how late they are open.
If it were me, I would go for the 2-day, 2-park pass for a few reasons.
First, we have never been a commando-style, get-there-when-the-park-opens and stay-until-closing couple (it's just my husband and me which could make a difference).
You have older kids -- do they like getting up early on vacation or might they enjoy sleeping in a bit? They probably can also stay up late with no problem. I also think at their ages, they would enjoy going to both parks, and choosing one over the other might not be as fun.
I would make a plan for both days. Choose MK on the day it is open the latest, arrive exactly at 2 pm, and know where you want to go and what you want to do. Your kids will probably want to do Splash Mountain, Space Mountain and a few other things. Get fast passes as soon as you arrive. Stay for Wishes and right up until closing. Eat lunch before you go to the park, so you will only need to stop to eat for dinner or a snack.
For the MGM day, also plan which attractions are not to be missed. Arrive after having eaten lunch at exactly 2 pm and enjoy the rest of the afternoon and evening, right up through Fantasmic and closing. Your kids probably want to do RnR and ToT - get fast passes for those. Plan which shows are important and check the times as soon as you arrive.
Use the mornings to sleep in, enjoy the pool at your hotel/resort, go to DTD or the Boardwalk, etc.
I would much rather have 2 shorter days at 2 parks than one long day at one park. My husband and I always go to the parks for shorter periods of time than the average family, and usually arrive later in the date and park hop to other parks where we arrive quite late. We have always felt able to do what we wanted to do in the time available.
Susan