I work for a company that is mostly remote. Of our 60 employees only 13 work from the corporate office, the rest work from their own homes. I happen to be one of the office personnel, however, I have the flexibility to work from home as necessary. I could probably work something out with the boss to work from home fulltime if it became necessary for me or if that's what I wanted.
I have a son in pre-school and I've stayed home and worked in the past when he was sick or didn't have school. The flexibility is great. I can save my vacation days for actual vacations. I don't think I could work from home all the time, though. Working from home while watching my son is frustrating. I feel like I'm taking advantage of my position since I cannot fully concentrate on my work, but I also feel like a terrible parent because I cannot give my son the attention he needs. Sometimes he's literally sat and watched 3 movies in a row for almost 6hrs. I have to say to him "Mommy's working bud, you'll have to play by yourself." It is nice to be able to sleep in that much longer and wake up and work in my pajamas, but I think I'd also go crazy if I were stuck at home all the time without real human interaction with other adults. Depending on how things go with the addition of the new baby it's possible I may choose to work from home 2 days a week to get a break on baby's daycare expenses.
I think it'll really depend on what kind of work-from-home position you have. If it's something that doesn't require constant attention and is easy to get up from and go back to then you'll be ok. Likewise with the hours you need to spend on it. I work full-time (40-50hrs/wk) which is too much to do from home with children. Something part-time would be more manageable from home. Something commission based would be best.
LO has someone to play with and I get to be with him all day, while doing something I love 
