Have been staying at Hyatt Incline for years. During the summer it has a very nice beach all set up with chaise lounges and cabanas. Lots of kids there. The water is very cold but most kids don't seem to mind. We have stayed in the lakeside cottages many times. No, you can't use points to get one. What you might be able to do is use an award and then pay the difference between what category room you get for the award (or suite upgrade) and the price of the cottage. You would have to contact the reservations manager at the hotel directly. I have done this before. Even at that, they are quite expensive, but very nice. Be aware these are not private cottages. Each cottage has two floors with a one bedroom suite on each floor. Each suite has a connecting 2nd bedroom which you can rent, or the hotel locks off and rents as a separate lakeside cottage room.
Boat and jet ski rentals are available, but as mentioned, they are rather expensive.
Reno is not quite as far as someone indicated. It's a 40 minute drive. I wouldn't recommend the Napa valley for kids and teens- nothing for them there.