Are device backups kept separate for each iPad or iPhone in the iCloud Family Sharing plan?

Yes. Note that with or without sharing a storage plan, if multiple devices are backed up to iCloud, each backup is separate. In addition, when sharing iCloud storage, each individual still has their own storage account. See the following from Share an iCloud storage plan with your family - Apple Support

When you share a storage plan, your photos and documents stay private and everyone keeps using their own accounts with iCloud—just like when you have your own storage plan. You simply share the space available in the iCloud storage plan with your family members, so you only have one plan to manage.