Did you read the article? That is the point; most people share your view.
Buses are safer because the tightly packet seats act like little pods of foam, like little safety bubbles. If the bus hits something, it's 4 inches of foam that the kid is going to hit...basic physics, f=ma, a=v/t...the foam increases the time it takes the moving body to slow to a stop, and spreads the force over a longer period of time. Since it would be instantaneous, not aggregate (I'm making both of those terms up, no idea what you would actually call this) force that you care about, a longer time at a lower force == a safer collision.
Think about it like this: you have two buckets, one of them is called "child" and the other called "seat". These two buckets contain a liquid called "momentum". If the bus hits a brick wall, all of the momentum from the child is going to get transferred into the "seat" bucket. The interstitial bucket you use to transfer this liquid is called "force".
The foam seat means that you're using a little tiny thimble to transfer the momentum from the child to the seat...it takes a long time, and it isn't very big...it's "gradual".
It's counter-intuitive, but that is one of the reasons that buses are safe.