Midwest luxury
Having lived in IL, MI and currently MN, my experience is that there are fantastic, world-class hotels in Chicago, and lesser but still good options in other midwest cities. But there are really no properties that meet all three of your criteria - luxury, family-friendly, and resort. I haven't been to Kohler for a few years, but it is very nice. Not rundown - in fact, it is in the middle of a renovation. Good food, good spa, good service, great golf - but I am not sure about kids activities.
We tried the Inn at Bay Harbor a few years ago, up near Traverse City. It is a beautiful location, with nice large suites, but the food and service were sub-par.
You are right about the Dells - cheesy and not lux (there is a spa there, Sundara, but it's a mixed experience, and not suitable for kids).
One place that you should check out if at some time there are just adults is Canoe Bay in northern Wisconsin. Relais and Chateaux, lux all the way. It's truly lovely.
If you are thinking farther afield, both the Broadmoor in Colorado Springs and the Greenbrier in West Virginia are excellent choices. But they are more than a days drive.
If you do find someplace suitable, let us know!