Sorry to resurrect this, but i'm still faced with this problem.
I'm using the free version so i'm unable to try it with families. However, i have tried lots of different ways of doing this, but still cant get them to overlap correctly.
Just to make it super clear, what im trying to do is set my sprites so that they are displayed above an instance of the same sprite (and others), when they are closer to the bottom of the screen (Higher Y value). Also, when they move back above the sprite, to then be displayed behind.
I would list everything i have tried, but aint nobody got time for that, and to be honest i cant even remember.
If someone could give this a crack it would make my day. been at it for ages.