Imo, ballroom dancing. I heard it's a big deal every weekend.
As the nearby Lunar New Year celebrations imply, the area is majority Asian.
Dancing in formal ball room settings, west coast swing, and for urban cowboys- country western are very popular forms of recreation amongst Asians in the LA area. I remember reading an article about a Vietnamese couple winning the national west coast swing championship.
Was there a program or party going on there?
It doesn’t sound like bar where alcohol is served. It sounds like the kind of a place you take children
My vague impressions is that dance floors in these areas come in several variations.
Some are studios with, as you stated, a focus on children.
Others, however, maybe focused on adults (dancing is popular with LA area Asians) and exist as kind of a private or semi private club where those interested in dancing there apply for membership and probably pay a fee. Other such venues could be open to anyone who wants in,
I imagine alcohol also varies from none (possibly this one?), to alcohol licenses, to BYOB to "grey" sales. Say, the owner's relative always BYOBs in cooler size quantity- then mixes popular drinks for "tips" while hoping the city does not show up.