@Naomi I think that’s a great idea, least other kids feel involved & it doesn’t cost extra for the party bags!
I’d do party bags for invited only, you know they’re all the same age so the bags will be suitable. Some siblings may be quite young and you would end up making totally separate ones based on age! I think extra cake seems fair x
We do party bags for siblings too but we've only had 3-4 people bring siblings so it wasn't a big deal. Sometimes they're quite little babies as well so I just got them some rice cakes and a tattle or something as they're not eating cake and would probably try to eat the party favours.
When this happened to us. I did party bags for the invited children. But made sure I had enough cake for siblings.