Yes, you're right on both counts, Jodi.
Many people do use Ice daily. Perhaps you could pour a little in your hands, then rub it on Sneakers so that you don't actually have to squirt him. He's pretty new to your house; if it was me, I wouldn't try to spray him until he's had more time to settle in. Then, you should be able to ClickerTrain him to accept it.
I took the easy way out on your nipping question. I do think that your first priority has to be to protect the kids, but, you're right, there is more to it than that.
I am sooo glad that you are going to start clicker training!!! That's great news. Besides the fact that clicker training is just plain wonderful, it will give you access to a trainer. You should be able to get help from him/her regarding behavior issues.
The absolute BEST source of dog information on the web is found at:
http://www.clickersolutions.com
Click on training articles for all you ever wanted to know about problem-solving with clicker training (or follow this link):
http://www.clickersolutions.com/arti....htm#behaviors
There is a link on the home page to join the email list which is also totally awesome. There are a large number of trainers and animal behaviorists on the list who really know their stuff. Since it is a busy list, I recommend that you get it in digest version.
There are a number of Brits on YorkieTalk (Yorkies originated here, after all). I, though, am a mongrel - an American living in England!