Hi KatieGiraffe I have no experience of this at all. But for what it is worth I think it is appalling that any school should fine a family for taking a holiday with their kids. To me it is bloody cheek.
However, sadly, it is the law.
There is an old article here.
www.theguardian.com/education/2014/jan/29/parents-children-holiday-school-terms
In your shoes I would pay the fine rather than running the risk of it going up. However, in your shoes, once the fine was paid I would write a strong protest letter to the school and Ofsted.
In my humble opinion the school say it is all about the child but actually it is about the child getting good grades so it looks good for the school. So it's not really about the child, IMHO! And on your holiday you may have had many wonderful experiences that are going to be educationally beneficial for your child.
I feel it is so sad that schools have to fine parents to make sure kids are there all the time. To me this says quite a lot about school. And it's not good.
But in your shoes, I would run the risk of the fine going up, I would see it as paying for the privilege of a holiday with your children. 