A.B.
My son and daughter are 7 days short of being exactly 5 years apart. My son is the oldest, I have always done birthday parties together except for my daughters 1st birthday since that is a big deal. I have done parties at home and one at Chuckie Cheese for the both of them at the same time. It makes it much easier on myself and family instead of having them come to two separate parties within a week or two of each other.
My son does not mind this, they each get their own birthday cakes, and own decorations.
As the others have said though the baby will not remember but I prefer to do big parties such as, 1, 16 and 18 separate. They are both in school this year and I also do allow them to have friends over from school for their birthdays.