We have an 18mo and a 4yo we read books and play games with on the iPad. The 4yo gets to play games or read books on his own as well.
Any app that doesn't let us unlock everything to remove IAP or Ads gets uninstalled.
For one I don't want my 4yo racking up $$$. But it's also frustrating for both of us when he clicks a button and gets taken out of his app and doesn't know what to do now.
So for us at least it's not that "parents can't resist". It's that $13 or whatever isn't all that much to spend if our kids like it, and we don't want IAP buttons and/or Ads in front of our 4yo. Perceived "value" has almost nothing to do with it.
Apple generally gives a 10% discount for buying a season pass. I'd be fine with that. A greater than 50% discount is surprising.
A better model might be something like FarFaria, where we pay an iTunes subscription fee to unlock everything and get rid of the ads. So recurring revenue ($4/month). You might consider it.
I don't claim we're super typical but I doubt we're all that special in regards to letting our children play with Adware either.