First and foremost ANY Bermuda guest accommodation (from large resort hotel to small guesthouse) will be a "..child friendly enviornment..' for reasonalably well-behaved and perhaps more importantly WELL PARENTED children.

Both ARIEL SANDS and SURF SIDE are good choices...but with only one restaurant on-premises, they may not suit large, mixed family groups as well as other places. Of the two, I'd be inclined to recommend SURF SIDE over ARIEL SANDS. Either will be about equidistant from downtown Hamilton via public bus or taxi.....but SURFSIDE will be a bit more conveniently situated to more south shore restaurant alternatives and great south shore beaches. SurfSide also offers some family units with full or partial kitchen facilities.

GROTTO BAY RESORT may suit your purposes best though with more on-site activities, a few dining options (though nothing memorable) and a beach with absolutely flat / calm water (no surf) and shallows to allay concerns of anxious parents.

OR..... perhaps multi-unit, private rental cottages and apartments,with either full or partial kitchens. The self catering availability would allow parents to prepare some of their own meals--breakfasts, some lunches and snacks.

http://www.grottobay.com/

www.bermudarentals.com

http://www.bermudagetaway.com