Choke chains rarely do any good, and can actually cause quite a bit of damage to the dog. If she's a wicked puller and you don't want to invest the time to train her on a flat collar, you can get a prong collar at any local petstore. They look wicked, but they really don't do any damage. I've used them on my Pulling Hounds and they work wonders...just make sure (this goes for the choker too) that the collar is right up on top of the neck, right under the ears....otherwise it won't work and can hurt the dog.
As for pits with kids...well...check out the gallary.
My aunt's pit bull, Boba, who isn't the most sound pit bull in the world, will melt for any kid. Her human brothers, Noah who is almost 6 and Moses (don't ask) who is almost 2 hug her, prod at her when they think nobody is looking, lay on her, play with her...and she LOVES it. Moses favorite game is hide, than run up and flop on Boba. She's less than pleased, but just gives you a look like "Man, I love this kid, but you gotta make him stop this crap."
That being said, one of the golden rules of responsible dog ownership is to never leave dogs and kids alone together...never....regardless of what breed the dog is...mostly because kids are just plain evil.
And, as with any new dog, make sure they really do get along....I don't blame your wife either. I LOVE pit bulls and would still be uber cautious with ANY new dog around my kids (if I had any). Trust your judgement, but do keep your eyes open. Sooner or later, she'll come around and the dog will probably steal your spot on the bed. Fair warning.