I have travelled a good bit on airplanes with toddlers/babies. I wouldn't use the carseat for the 3 1/2 year old. The tray table won't lay flat with a car seat. If he/she wants to draw/color/eat, that's a problem. It is true that car seats can not block other passengers. I might put the 18 month child in a car seat--mostly because it keeps them calm.
I would put the car seat in the window, you in the middle and the 3 1/2 child on the aisle. Make sure you PRE-BOARD to get seated together. I've been separated from my children on more than one occasion by dumb *ss ticket agents. Other passengers are amazingly hesitant to move to help you out. Sit in seats together-even if you're not assigned those seats-and refuse to move if you're asked.
few other tips: bring benadryl for longer flights. ask your pediatrician for dosage. I have been on enough flights with screaming babies to be an advocate for this option.
other lightweight amusement options: few rolls of scotch tape--it will keep them occupied for a good half hour, silk scarves (not good ones), finger puppets, few books, plastic cups to stack or play hide the object-they-won't-choke-on, LOLLIPOPS (must have-will shut them up if they get fussy), other passengers (especially the ladies "of a certain age" to play peek-a-boo, plus you don't have to carry them!), snacks (anything that requires a while to eat-like those vegetable chips.)
Check everything-including car seats/strollers--except for what you absolutely must carry.
tell the gate agent "I will require assistance at the arrival gate". Use that term. An airline representative will ferry you to baggage or the next gate in one of those nifty golf carts. The kids will love it. You won't break into a cold sweat hauling all their stuff. You won't have to worry about being distracted. I missed an international connection with my 13-month-old once because my flight was late and I couldn't make it to the next gate as the stroller was stowed in the rear of the plane. Most US carriers are happy to help.
good luck. you will feel so proud and competent when you arrive where you're going!
J.