This is different to how it has worked in the past so I wonder if they have recently changed it.
IME (recently, or well the latest was a year ago) when you book a ticket for a child under 12 the child's seat reservation is "free" but then everybody in the party, or at least one adult per child (unsure, as it was just me and DS3 last time) is ALSO forced to book a seat reservation, this is paid as in you pay the seat reservation fee which is £9 or something, or you can opt to upgrade to a service level which includes a suitcase plus the seat reservation kind of thing.
But yes, it should not let you go through the booking process without this. Or at least, that's how it worked about a year ago.
I can't check this without actually booking a flight, but I wonder if what's happened is that when you get to the confirm purchase section, the seat reservation is automatically selected and you have to actually click on it to bring up the big diagram of the plane showing where the seats are and which are available. And if you'd not noticed this, or seen that the reserved seats are "12A 13A" and assumed that meant same row and just clicked through to confirm, that might be how this has happened? But I'm not sure exactly how the seat reservation works, as I can't remember.
There IS a separate issue, specific to Ryanair, which is that previous to about 2013, all airlines had the option either to book specific seats, usually for a fee, OR be allocated seats at check in. The point of this is that you can then choose if you get a window seat, if you get a bulkhead seat with extra leg room, if you want to be near the toilets (or not!) etc.
If you chose not to pay for a specific seat, then at check-in parties would generally be seated all together, though this might be behind or across an aisle, except when it was a large group and/or when the plane was already quite full. But in general, you could assume that booking = choice of seat, not booking = random placement, but 99% of the time you'll be together. ALL airlines did this. Most airlines still operate like this.
Then in approx 2013 (I forget the exact time scale) Ryanair instituted a new policy, whereby if you book seats then you can choose to sit wherever you like, but if you do not book seats, then they will purposefully split people up within a party so that they are not sitting together. They don't explicitly state this, but I noticed it because I took a few Ryanair flights in the ~5 years after this change and people were reacting to it and/or confused by it and there was some disruptive behaviour because of it. For example, I remember going on a flight with a large stag group who were all seated two rows apart down the plane. For most of the flight, they stood up in the aisle loudly talking and laughing and generally being annoyingly in the way. And when I took a flight in 2018 when I was visibly pregnant with DS2, I was sat next to a woman and two rows back her husband was sat next to DH, and as soon as we realised this she instantly offered to swap places with DH "so that he can be with his pregnant wife", the flight attendant agreed and so they swapped places. It was a basically empty flight because it was off peak season and midweek.