I would definitely try to find something that is walkable to a village and a beach. Some of my favorite areas are Osterville, New Seabury, and Hyannis. Provincetown can be fun, but maybe not the best for kids. Beach there is really pretty. Ptown is also a far drive out. The other area I mentioned are more mid-cape, which is important when you consider traffic can be a bear on weekends getting on and off the cape.