Cliff,
I guess your caddying experience at Baltustrol was far different than mine. No doubt that Baltustrol has some very wealthy people and those kids didn't need the money. But my club has a really long tradition of members' kids caddying and it is really very cool. Since I am now 51, many of my former caddies are now members and our friendships have long roots. The downside is you have to watch what you say, but really, if you can't say something because a members' kid is around, should you really be saying it at all???
Members kids absolutely do not get preference, and both of my boys have spent 4 +hours there with no loop, just the phone call to Mom to pick them up.... Our caddy master calls those days "character builders." But as my oldest got better, (and became a single digit handicap,) he worked his way up the pecking order and people began asking for him.
Geeze, if we didnt allow members' kids to caddy, Jimmy McGovern would not have carried my bag when he was in college, and I would not have received his lesson on how to hit out of fairway bunkers!