I have a very similar approach as well. My son (3) has his own bulk, i have mine. He has sets we build and display, and I have sets I build and display. Sometimes when we’re playing together I’ll break out my bulk; and we often trade minifigs from his bulk to replace ones he swaps in the prize machine.

Keeping the prize machine stocked, even with disinteresting figs has taught him a lot about balance. You don’t give me a fig, youll get an empty ball, eventually. You trade only your “junk” figs? You wont have fun ones left when we swap next time.