Wife, I and 2 dogs lived more or less full time in our Palomino a couple years back for about a year. We had sold our old house and were between houses and "moved into" the kids back yard. We had access to the house if we needed it, but were happy in our own space. Then the new house needed some renovations when we got it, so was easier to stay in the camper while we took our time remodeling.
The kids (well, actually my house but they rent it from me...) live in a secluded big lot where there were no problems with the neighbors and zoning issues. We actually set up a fire pit and the kids would come out to visit with us many nights and sit around the fire instead of being inside watching tv!