I just migrated to Family Sharing from this setup. You can't see each others locations unless you opt in, and you aren't any worse off from the shared app store account setup.
Each had separate iCloud accounts. All used a single
shared_app_store@address.com account for iTunes and Apps.
1. Create a new user account in System Preferences > Users & Groups
2. Log in Mac as that user.
3. Go to System Preferences > iCloud and sign in with that
shared_app_store@address.com account
4. Log in to Mac as user that will have billing control - the "Organizer"
5. Go to System Preferences > iCloud > Set Up Family and enable
6. Change "Family Purchases" to the iCloud account of that user
7. Invite
shared_app_store@address.com to join the family and enter the password to set up
8. Log in Mac again as the new user account created in step 1
9. Go to System Preferences > iCloud > Manage Family
10. Choose the Me user and ensure "Family Purchases" is set to the
shared_app_store@address.com
11. Log out of this Mac user account. You can now delete it.
12. Log in again to Mac as user that has billing control - the "Organizer"
13. Invite the other iCloud accounts. On their device, go to Settings > iCloud > Family > Me and change their "Family Purchases" to the iCloud account of that user
14. On all devices, go to Settings > iTunes & App Store > and sign out of
shared_app_store@address.com and sign in as the user's individual iCloud account
15. Open Apple Music, purchase the family plan on any device (and it's okay if you had already purchased it under the
shared_app_store@address.com account)
16. All users will have individual profiles, and can play simultaneously.
Don't fear anything:
All purchased apps and music work as before and keep updating correctly
There is no downside compared to the
shared_app_store@address.com approach.
Behind the scenes, that's what it's doing anyway.