That was the
I'm 100% aware of that. I'm just saying from my own experience is you can still file a sponsorship application. IRCC will take the steps necessary to make a determination of status and then tell you what needs to be done for the process to continue.
Yes, it can be done. But the necessary step for you to be sponsored was to NOT be a PR anymore. No-one was saying that the spouse of a citizen/PR cannot be sponsored (or at least not because of this) - but that they can't be sponsored while they are a PR.
That's why the simple steps are: apply for a PRTD. If they are granted the PRTD, no need for sponsorship - you've been given a document to return to Canada as a PR. If refused, IRCC will revoke (or they can renounce) so that they are no longer a PR, and then they can be sponsored.
Now in some cases it may be clear that just renouncing and applying for sponsorship is superior (eg if PR has been out of Canada for so long that chances of PRTD are slim to nil). Another reason is that not having a valid PR card can be an inconvenience (although less so if the PRTD is granted for H&C reasons).
But for those eg who can travel through USA, or are only slightly out of compliance, and who need to return sooner, it MIGHT be faster to go the PRTD route than renounce-and-reapply.
Problem is, no way to be sure which is better. And sometimes PRTDs seem to take a long time even to get refused.
[My own guess for the OP's case, where wife and child basically never settled, and there doesn't seem to be urgency, renounce and reapply might be better - they'd get new PR cards and health care with no issues, etc. But only a guess and it's for the OP and spouse to decide.]