Two agrees :
1) Porto is a lovely city, but doesn’t need more than a couple of days at the most.
2) The Sheraton is 3 miles walk from the hub (the Luis I Bridge), so you’d need to be using public or private transport to shuttle in an out. It’s a nice hotel in an unremarkable neighbourhood, Iand I really wouldn’t want to be holed up here for 5 days with 2 young children.

Have you considered the Sheraton Cascais near Lisbon ? Plenty of beaches and good kids stuff in the vicinity.