You can use code, obfuscation, and encryption on ham bands but it requires that the keys and meanings be publicly available. This is not highly recommended, but it is not illegal.
My recommendation would be to put forth the time and effort to get licensed ( I got general on my first try) and then pick up some used Motorola, Icom, or other commercial radio and get the programmed to a few channels in the ham band for your group to use. This will not be the cheap option, but they will stand up to about any abuse you can throw at them and the actual radio parts of them generally are much better.
I currently use VX-170's and hx-370s radios by Yeasu and Vertex Standard (same company, Ham/Commercial faces) with waterproof speaker mics. I am waiting for a good deal on headsets. I have a few "channels" that I use with my friends that are hams and we all have them stored so we can reference that faster.
I have a standing offer with my friends that are not hams. I have two of the training books that I loan to people willing and I pay for their first test ($15). Only about 5 of them have taken me up on it so far though.
Yes the FRS radios could work (GMRS is $85 a person for 5 years.... Ham is better) but the range is horrible and you are stuck with the antennas that they come with.