At the end of Act 2 in The Miracle Worker, what is the significance of the lullaby and the reaction of the family?

What an interesting question!  It's quite an baffling way
to end the second act, I'll admit.  Quite simply, Annie has just had a late-night
session with Helen, using Percy to spark jealousy a bit so that Annie can work with
Helen more closely.  Before the lullaby begins, Annie's last line is, "Now all I have to
teach you is--one word.  Everything."  Annie then picks up the doll that causes so much
mayhem earlier in the play, sits in the rocking chair, puts on her glasses, and happily
begins singing "Hush Little Baby."

What is important here
is the progression of feeling that Annie experiences while she participates in this
lullaby.  First, Annie "whispers to it in mock solicitude."  Soon
after Annie "lays it against her shoulder, and begins rocking with it, ... she
talks the lullaby to it, humorously at first."  Later, "the rhythm
of the rocking takes her into the tune, softly, and more
tenderly."

Look at Annie's movement from
disrespect to tenderness!  In my opinion, this directly correlates with what is
happening in  Annie's relationship with Helen.  Remember Annie's first experience with
Helen, mocking and grousing behind Helen's back.  Now Annie desires to be close to Helen
and feel affection as Annie teaches Helen "everything."  (I could even go further and
say that this correlation extends from Annie to Helen, herself.  Helen is similarly
moving from feelings of hate to feelings of
affection.)

While this is happening (and even though this
is happening in a separate place than the family), the family has a definite reaction. 
James, Keller, and Kate all stand "moveless" while each of them has stopped where he/she
is and "turned his/her head, as if hearing."

Similar to the
meaning behind Annie's lullaby, the family's reaction indicates that they notice Annie's
change to tenderness towards Helen.  No more snide reactions such as when Annie is asked
if she likes the child, when she replies, "Do
you?"

Love is growing here.  Annie is
growing to love Helen, ... deeper than a mother's love perhaps: the love of a beloved
teacher.  The family is growing to love Annie for the work she is doing with Helen.  And
if love isn't in the vocabulary yet, they are at least admiring Annie's desperate
attempts.

There's more to come, Keller family.  More to
come.