Personal opinion: Uprights - yecch.
Not to say they can't be well made, but most of those old manufactured pianos are blech. The sound can be good, but the action isn't reliant on gravity and they can be a mess to restore.
If your piano is in top condition and works, I guess you can keep it.
However, digital pianos nowadays are so good they're worth the money and in some cases, you have to be pretty trained on the instrument to tell the sound differences between acoustic grands and digitals. Also, it's a misnomer that pianos appreciate with age - the opposite is true. So don't keep it for "antique value." It won't have all that much, unless it's in tip-top shape.
If it were me, I'd get a digital no matter what. The sound and action on today's good ones are for the money phenomenal. And in some cases even trained pianists can't tell the difference (especially on tape/recorded). I have one from 1990 and have never looked back. Sure I'd love a grand in here, but this has more than served my purposes and I've played on/off professionally for decades.
Suggestions would be to start with the Yamahas for sure. I'm partial to Yamaha grands over any other, and the Yamaha digitals are incredibly good now. I wouldn't get sucked into buying one with tons of amenities (knobs and doo-hickey sound effects), but yeah, they're worth it. You can decide if you want a "furniture" type (full console that often can be removed anyway), or simply a keyboard (buy a stand). As you suggested, the overwhelming advantage is you can plug in headphones and/or turn down sound. Plus if you do get one with some effects, the kids might actually be more drawn to playing it (kids nowadays and their e-stuff).
You can look at things like the Yamaha PT or Arius series for less expensive ones, or the Clavinova series for more pricey (and frankly absolutely incredible) ones. I have an old Clavinova with 1990 technology and it still rocks - and is as solid as the day I bought it. Look at this for a primer: https://acousticrealm.com/best-yamaha-digital-piano
In the end if you keep the old upright, you'll do okay, but never say the digitals can't sound and play like the real ones. They're damn close if not on mark.
Edit: Oh, and I'd always suggest 88 (full) keys... in the old days they had trouble e-duping the highest and lowest notes on the piano keyboard, but nowadays they've nailed it down.