Have you priced out your car rental and found an acceptable rate? Picking up and dropping off in different countries does usually raise the price.
Are you booking an advance-discount train ticket from Zurich to Frankfurt through the DB German rail site? If so, then your remaining "main" train rides between Zurich and Muerren are worth about $75 each way. Other transport during your stay can add up, although higher lifts won't be fully covered by any pass. See "What do rail passes cover in Switzerland?" and more ticket price in Rick's Berner Oberland chapter (schematic map) or at http://www.jungfrau.ch/en/tourism/travel-information/tickets-rates/interlaken-ost/fares-for-individual-travellers/.
The Swiss Travel Pass for 4 consecutive days would not cover one of those $75 rides, given your 5-day time frame. If you choose the one-month Half-Fare Travel Card, the three older travelers each pay about $134 for the card, then pay half price for each ticket as you go. The youngest child gets the free Swiss Family Card, which covers all transport that you take together.