Your children are first. If your dog hurts your children they can become fearful of dogs forever. Somehow you seem to be managing the dog and your kids.
Yes, the pain can cause him to nip at the kids. He is a teenager now, and the painful hips makes training and exercising him properly very hard. I don't like trainers who try to dominate someone else's dog. If the dog is fearful, what choice does the dog have but to snap at him?
Remember that barking, growling, snarling (showing teeth), and snapping are all attempts by the dog NOT TO HAVE TO BITE someone. But it is disheartening that he is growling at your nieces.
Send a PM to Karma, she has a bitch who is a couple of years old now that she rescued and had to go through hip surgery.
Without the pain (hip surgery), some NILIF, and I don't know, a bit more time, and your pup might be a different dog. And, unfortunately, he may not.
Alternatives to consider:
1. Call the shelter, explain the issues, and what the dog needs and see if they know of anyone that might be able to help you. Who knows, someone might be willing to help someone keep their dog by providing some veterinary care or money for care.
2. Apply for Care-credit. And do the surgery and pay over time.
Utlimately, you need to make a decision. Another person might just euthanize this dog for either one of his problems. I am sorry you are having this issue.
If the vet will help find him a home that can manage both the medical and the training needed, that really might be your best bet. But no, it won't be easy.
Jenna, RN CGC & Babs, CD RA CGC HIC
Heidi, RA CGC
SG3 Odessa, SchH1, Kkl1, AD
Ninja, RN CGC & Milla, RN CGC
Joy, Star Puppy, RN CGC
Dolly CGC & Bear CGC