Deciding between longevity/reliability and budget comfort with a used vehicle

I'm spinning off my own thread about getting a used car to see if my thinking is financially sound. TL;DR is at the bottom, but I thought I'd throw in some details to show some context.

I've enjoyed some nice financial freedom the past three -four years. That's when we sold our rental property, paid off both cars, and dropped a kid's preschool cost. At one point, we were solid on our emergency savings and maxing our Roth IRA contributions (in addition to our pension and SS contributions) while still having $1000 leftover per month as extra money for savings, home improvements, fun, etc. Not bad for two teachers.

In December of 2019, we decided to upgrade to a family vehicle as we were driving sedans. This brought on a $200/month note on a nice SUV that ended up having problems the dealership could not diagnose and fix. During this time, we sunk our savings into home projects that sprung up (new HVAC, furnace, ductwork - roof issues - new gutters - new windows that exposed wood rot). We spent about $25k between November of 2020 and March of 2022.

In March of 2022, the sporadic transmission issues with the SUV were getting so regular that we didn't feel safe taking it on family trips. The dealership and other mechanics still couldn't diagnose the problem. We decided to sell it and picked up a Honda Pilot for $38k. We only used the trade-in value as the down payment due to depleting our savings for the house so much. This led to a $465/month payment.

In addition to the increased car payment, we had to look for a preschool for my daughter, and our sweet home daycare with a family friend that was $600/month increased to $1000/month. We made the decision to move her to this preschool back in January when spots were filling up. We only had a $200 monthly payment as debt other than our mortgage of $1150.

This summer, my 18 year old Honda was hit in a hit and run. The upholstery needs to be replaced in the inside. The exhaust has a hole in it and needs replaced. And now the transmission is having issues. We estimate it would cost at minimum $4000 to get it back to being reliable. But the bigger issue is that my wife drives the Pilot 30 miles each day for work, and my commute is 4 miles. I need to drive the Pilot with gas being so expensive, and she needs to drive the sedan. But the sedan we currently have is in need of repairs that are about equal to what it would sell for if it was in good condition.

So now we're trying to keep our budget low with a new car payment. Carmax quoted us $1000 for my POS and we have $6000 to put down. That would leave us with $5000 in emergency savings, and when I crunch the numbers into our budget, a $350 car payment leaves $300 of cushion if we're living frugally each month. That's no saving for vacations, adding to general/emergency savings, kids clothes, incidentals, etc. It's not horrible, but it's not great IMO. No going out to eat but maybe once every few weeks. Constant worrying about house issues popping up.

My daughter will be in preschool for two years, so I know we'll clear up a good bit in fall of 2024. Then hopefully our vehicles are good for longevity after they're paid off five years from now.

TL;DR

So I can get a 2021 CRV for $29k with 20k miles. I know it will last a really long time and has great reliability. But it crunches our budget even more. I estimate it'll be around $430/month for 63 months.

Our budget is currently $25k or less. We're finding a lot of dog shite vehicles at this price. Many of which have 50-60k+ miles. The Nissan Altima we're currently looking at has a smoke smell. Longevity doesn't seem like a guarantee, but I can probably get in my $350/month desire.

So is ~$100/month cushion worth it to you all in my situation? Or would you go for a more expensive vehicle and just bite the bullet for five years?

**My wife will be driving the secondary car, so I can't just say "I'll buy a cheap POS and save up more money." Unless you all would advise paying more for gas with the Pilot and I drive the POS.**

Feeling pretty lost here. Sorry for the long thread. Finances have been comfortable for a while, so I'm in disarray trying to navigate inflation and the current market.