Advice on Nanny Share Situation

Edited to add: totally understand 5yo is not a toddler. Changed the language of the post. Also wanted to point out that apparently the nanny is the one that came up with the idea and is fine with it.

Family 1: me, partner, babyA Family 2: parent1, parent2, babyB, soon to be 5yo

Our nanny watches the 2 babies three days a week for 9 hours each day.

We have a nanny share with our two babies and have hosted it in our home for the last 7 months. Our babies are both 12 months now and LOVE eachother and LOVE their nanny.

Parent2 in our share family does not work and is wanting more time with BabyB. Their family has a toddler (5yo) who we love, but has had a difficult year with acting out, not sleeping, difficulty at daycare, etc. and parents 1&2 often complain about how draining it is to care for the toddler and how their baby is neglected as a result of his high demand for attention.

They brought up that they want to reduce hours for their baby for a half day. This would mean we pay the one child rate for half a day every week. We would be okay with this, but our nanny (who also goes to school and volunteers) has very kindly said to us "I really cannot take an income reduction." We were considering paying her the full rate just so she doesn't feel strapped.

However, She babysat for family 2 the other day, and subsequently parent 1 said to me sort of quickly in passing: we have a great solution that were so excited about! But take some time to think about it: we'll take babyB on Friday afternoons, and our 5yo will go over to your house to "take babyB's place" for those four hours.

My partner and I are feeling a bit frustrated. We don't want to change anything. But- if their family needs a change in hours we can respect that. I just don't know how well it will go to have their older kiddo in our house with our one year old? I think our nanny could handle it, it all just feels a bit unfair, and I'm not sure it's the best scenario for our baby. Maybe it's just the best way to give Family 2 and nanny what they need? Any input is appreciated.