The period can be rewritten thus: "It would be preferable not to pass on many of
There are two sentences: the first is "It would be preferable"; and the second,
"not to pass on many of our own...".
The second sentence is the subject in this subordination
relationship. "It" then refers to that whole second sentence ("not to pass on...").
Edit: since my native language is a Romance, the "it" still (after years) feels alien and unecessary, but the grammar concepts apply almost perfectly.
Edit 2: As Shoe pointed out, the same passage may be expressed this way:
Not passing on our own childhood experiences would be preferable.
evidencing the subordination relationship: a period with two sentences, the
first of which is the subject.
But while the "it" in
It would be preferable not to pass on our own childhood experiences.
doesn't refer back to any noun in the sentence, it is a
pronoun that acts as subject of "would be preferable". And what would be
...not to pass on our own childhood experiences.
Therefore the "it" is a forward reference to what is to come.