Hi Vanilla,
I used to live in Killaloe up until bout 2 months ago and commute to UL would be 30 mins tops, the area to choose is the Tipp side Ballina cause thats where most of the development has taken place. The town itself has an abundance of childcare facilities and between Ballina & Killaloe there are 3 national schools 1 boys and 1 girls in Killaloe and mixed in Ballina. In terms of kids activities there's loads for them to do between drama, GAA, rugby, park, etc.
On the Limerick side Dooradoyle/Raheen is bout 15/20 min commute on the bypass, again plenty of facilities, but it is quite built up if your used to a bit of space. This area is prob close to its ceiling price in terms of appreciation in the near future, but it always sells well and there is usually a bit on offer so there is plenty of choice. Annacotty would be well placed for your situation as close enough to UL very popular residential location and still on the rise, Milford national school, and childcare facilities, plus you have access to the bypass should your other half find work away from the area. At the moment closer in to Castletroy there are some good prices on new developments. the shadow of students is not what it once was as most are now living on campus in new apartments or very close to the university. .
hope info is of some use