As a native of Ireland, there are probably two important things here:
These people have no idea about your family history.
A lot (really a lot) of Irish people live outside of Ireland and coming 'home' for big holidays would be extremely common. These people are just trying to find a point of reference with which to start a conversation.
In general these people don't really care about what your answer is, they're just trying to find a way to start a conversation (we really like to talk). Just answer briefly, e.g.
We'll probably be staying here for Christmas, enjoying it with the kids.
And move on to the rest of the conversation.
It can come across as very nosy if you're not from here, but we're all kinda used to living in each other's pockets here (even if we don't all like it).