My two cents from a guy who has honestly spent almost 1/3 of his life in RVs.
If you're considering a pop-up, I would strongly consider a 2-room tent instead. A popup is just a tent with wheels. It will eventually leak, it can't be packed up wet without completely re-opening to dry it out, and (just like a tent) it is useless unless it is set up. All of the shortcomings of a tent, plus you have to tow it, register it, and - depending on your state - insure it. Granted, some popups are far more luxury than a tent, but it depends on what you want. I personally chose a nice luxo tent. I leave my 32' fifth wheel at the lake, and I have an AWD Express van for overlanding and overnighting. As of yet, the Express isn't "converted" other than taking out the third seat, but I have plans for it.
My tent setup is a Kelty Sequoia 6 with a 4" Zinus memory foam mattress topper. I toss my clothes in a small tote which doubles as a dandy night stand. Add in a couple USB rechargeable lights that double as a charger for the phone and I'm good to go. Longer trips I'll take an EZ-up and my chuckbox/mess kit. Honestly, I can set up my tent faster than I can set up a pop up, and I can leave the hitch ball free for the boat.
I can't imagine a van conversion satisfying the original desire for kids having their own space. A shortie motorhome might be better for that. Or, if you're keen on converting something, short buses are often cheap.
Edit... sorry, forgot my main point.
My suggestion is to fold down the rear seats in the Caravan. That is sleeping space #1. Then tent, rooftop fold-out tent, or something else for space #2. Since a popup doesn't really trip your trigger, a super-sweet tent is $500, then go ahead and treat yourself to a nice memory foam topper as a bed for $80 and a couple nice amenities. Under $1000 you can be glamping.
This really only works if you aren't road-tripping, know what I mean? If you're camping trips are driving during the day and spending the night in somewhere new every 24 hours, not the greatest solution. If that is the case, I think a stubby class C is your ticket.
What is the tow rating on your Caravan? If you end up with a small travel trailer, you can pretty much ignore your tow rating. Travel trailers are made with such lightweight (read: cheap as berkeley) materials and they can give you a very false confidence. They make them lighter so they can make them bigger. So if your tow rating is 4000 lbs and you go shopping based on that, you'll find this lovely 24' ultralite with a GVW of 4000 and think you've hit paydirt. Then you realize that you're towing a 24' billboard, and every passing truck or gust of wind requires you to be 200% totally focused on the drive so you don't kill your family upside-down in a ditch. Depending on your personality, it can mean the difference between showing up at the campground happy and refreshed versus showing up ready to kill something... which is the opposite mental state of why you're vacationing.
This is also entirely dependent on how far you're going. When I full-time lived in a TT, I had a 31' trailer towed by an F350 SRW pickup. Definitely up to the task, but out in the midwest and deserts when you're putting in 10 hour driving days to get somewhere, by the end of the day I was really wishing I had bought a dually. If I were only driving 2 hours to a campground a few times a year, I would have done it with a half-ton and just dealt with it, but your distances will definitely dictate the equipment.