There's nothing wrong with a puppy being in a crate while an older dog isn't. You'd be allowing the already established dog time to get used to the puppy without becoming overwhelmed by the pup. I crate train my dogs, right from the start.
I used to work at a local vet, and one of my co-workers got a boxer puppy. She didn't even think about crate training it, and one morning she found the puppy knocked out and trembling. She rushed it in to work, and the vet found that the puppy's tongue was severely burned! They eventually figured out that the puppy had chewed an electrical cord during the night and electrocuted itself! Ended up losing nearly half it's tongue.
The dog I have now has a crate although we never use it anymore for her. The crate is really large, so when she was a puppy I'd simply stick boards through to reduce the crate's size, and as she grew I'd move the boards as needed. Once she was reliably housebroken we'd only use the crate if we were going to be gone for extended pe