Hi there,
I am well and truly doing the juggle! 
I have an 8month old and a 4yro. I also work 3 days a week doing my 'real' job and am studying.
Cookies are not my main income, I more enjoy the extra income so I can feed my cookie cutter addiction! So as to reach as much of a balance as I can, I limit the number of orders I take a week. When I started out that was only 2 doz a week until I was more comfortable and knew what I could do in a week with all my other commitments.
I also do a few things to help me time save. I have a large baking day once or twice a month when my husband can help with watching my girls and freeze the cookies. I find it easier to be able to just pull them out and decorate, rather than having to add in a baking day as well. Also when someone orders cookies I make sure I take the time to think of all the processes needed for the cookies before I accept the order and quote the price. I have been caught out quickly saying yes sure ill do those cookies and later realising that the design is a lot more time consuming than what I first thought. Rookie mistake and I'm getting better 
Not that I wasn't happy to do them, but I might not have taken so many other orders that week.
I tend to decorate when the girls go to bed, I've not been up to 2am yet as I usually do my deliveries on a Saturday and I start on the Monday of that week decorating, this gives me enough time for drying and if something should happen to come up. I can just do a few steps each night. Perfecting my 20second icing has also helped in a pinch my largest order was recently for a wedding of 130 brush embroidery cookies. I started these 12 days before delivery. In saying that I had a lot of support from my husband over that time and could not have done it without him.
Happy if you would like to chat further. My email is belleissimocookies@bigpond.com
good luck!
Belle