This year, I went to Kaghan twice. First time on public tranport with a friend and second time with family on my car. As you are inclined towards public transport, my two cents are:
Lahore to Mansehra I used Niazi Express. Mansehra to Lahore Daewoo. I will recommend Niazi express as they allow ample stop over for snacks, washroom and prayer. Upon my request, they even stopped for Fajr prayer. Daewoo was just dragging all along - get their shuttle from Mansehra, they will hardly provide 5 minutes to get their ticket at Abbotabad and will force you inside their bus, 5 minutes somewhere in Haripur, 15 minutes in Rawalpindi to pickup passengers and 15 minutes in Bhera. This "baysharm" service did not allow time for Asr, Maghrin and Isha prayers even after my requests for just ONE prayer stop. Eating is a far cry. So one can only go to washroom but I think 15 minute is short as well if there are ladies with kids. Time wise both Niazi and Daewoo completed the journey in 9 hours but Niazi's fare is just 50% of Daewoo. Though level of comfort is better in Daewoo but Niazi's is acceptable for family travel as well.
Mansehra to Balakot - use taxis. They will even go for 250 to 300 rupees, though they may ask a bit more seeing the family.
Onwards Balakot - As advised by Rana Sherdil, Hiace is a big no. I traveled with a goat that was trying to bang me, there was a guy next to me who was keep on spitting between his feet, leg room was limited. Above all, as it is off season, number of Hiace trips will be limited and if you will be late in the morning, you may not be able to get service that day.
So hire private transport, though expensive but will not be VERY expensive as season is off now. You will save a lot from hotel and jeep rentals.
I hope it helps. If you need further details, please dont hesitate to contact.
