My team used to each have an account subscribed to the plus plan and we shared a folder to access the files as a team. We recently decided to start a family plan and are wondering what exactly is the difference between a shared folder and a family room when subscribed to a family plan.
Essentially the Family Room is a mutual sharing point for all the Family members. Think of it, like the "basket" you can place things in, for each other to see.
While you can delete, move, or rename a shared folder, you can't do the same with the Family Room. Each one would have edit access to the content there. Whereas, when sharing a folder, the owner can determine the permissions of the members.
Another one is, that each new Family member will automatically have access to the Family Room folder when they join, no need to add them there.
You can have a closer look at Shared folders here.