I do think it's rude, but you're in their house so what can you do?
Seeing as you're all such good mates it's probably best to not read anything into it.
The family probably just revert to their native language as to them it's second nature, and they probably have no idea how intimidated you feel.
Europeans are different in the way that what we deem as rude they don't......the stiff upper lip and all that
