I think there are a lot of family-friendly historic places to visit in Southern India. The problem with these places is that they get very cold during winter, making the trip uncomfortable. But on a side note, it is wise to travel to the Southern parts of India during the very beginning of rains showers. The climate at this time of the year is very soothing and the fresh smell of the first rains in these places must be enjoyed. The ancient temples and architecture will make you crave for more. We had a great time in South India. I think travelling in India during Diwali is kind of complex. You would be amazed by the lights and crackers and the celebrations during Diwali but there will be a lot of road obstructions and smoke due to crackers. I can understand that some people get intolerant when waiting on the roads surrounded by fire crackers. If that wouldn't bother you, I would recommend that you travel during Diwali and take part in the celebrations. I am confident that this would be a great experience for you