I don't want the "dead character" database to be twice as large as it is right now.
Especially with effects that can target dead characters existing (and thus have to check against the list of dead characters to find valid targets).
Yes, having more children born and more children die *might* be immersive - but even historical records don't always record the stillborn and the infant deaths consistently.
There are historical royal families that will variously list just the children that made it to a reasonable age; children that made it to reasonable age *and* early infant mortality; or children that made it to a reasonable age, early infant mortality *and* stillborn babies - for the same royal couple, depending on the historical record.
For CKII they've adjusted the rate of child deaths several times already, and the birth rate is deliberately depressed to get the desired number of people surviving to adulthood.
Raising the (artifically low) birth rate and the (also artificially low) mortality rate won't do anything to solve what appears to be your major issue, that of dynasty bloat. That is more caused by virtually any marriage the player makes being one that passes on the dynasty, and the AI also making more "matrilineal" marriages than was historic. Thus there is less dynastic and surname collapse than historically occurred.
If you turn matrilineal marriages off, you will see dynasties going extinct far more often.
Low fertility/low mortality isn't fully equivalent of high fertility/high mortality. Family tree with parents and 3 alive children looks different than family tree with parents and 9 children, 3 alive, 4 died during infancy, 2 died later.
In practical terms it looks very similar, except for each line having more (effectively) meaningless characters. The amount of links to the next generation remains the same. The number of marriages looks very similar (assuming the 2 that died later died before about 16), and thus the dynastic links to other families remains the same.
As far as inheritances and dynastic links the two situations are functonally identical *except* for the lower load on the game from less dead characters.