Hi, we have been camping in the Penticton area for quite a few years. Our kids are now 11 and 16, the other family we camp with their kids are much the same ages. Usually we camp at South Beach.
Oxbow (next door) looks so much nicer, with lots of green grass, yet they are more expensive, and they don't allow dogs that are over a certain size (ours are larger), they won't allow laundry lines (for beach towels and such), so we usually stay at South Beach as I said.
South Beach is much, much larger, with a lot of camping sites, that are quite close together (as are most these days) and very dusty with very little grass, and depending where on the property you are, can be very noisy, as they are right along the very busy highway, with transport trucks all night. I think their web-site has a property map. They do have a small kids play area (maybe even 2).
Both are a perfect location, being across the street from Skaha Lake, great for camping families.
Wherever you do stay, have a great time, and enjoy the area for all it has to offer.