We stayed in Shanklin last summer.This was my first visit to the island and I would definitely go back. As someone said to me, it resembles Britain twenty years ago. The bits I saw ( mostly east coast) were pretty and quiet, the beaches were lovely and the area had lots of child-friendly places to eat, drink and stay. And it was so relaxing! My sons really liked it, and we have sworn to go back this year.
We drove through Sandown and Ryde - both had lots of seaside attractions - a few too many for us - but not in the same league as Blackpool. Shanklin seemed a little quieter. Ventnor looked good, too. The tourist board told us it was considered more refined than its neighbours. On the west side of the Island we got as far as Alum bay, to see the famed coloured sand. This place is quite commercialised and I would not recommend it. The children loved the fairground, though!
I stayed with my two sons for a few days break in a simple child-friendly bed and breakfast hotel - one of many recommended to me by the tourist office. We all had a great time and the price per night (incl huge breakfast) was OK. Our family room cost about about £40.00 per night, if I remember correctly. LOts of hotels offered an evening meal/full board for about £10.00 more than the B/B price. The Roseberry hotel (tel 01983 813818 if you are interested) had a children's playroom complete with toys (including a playstation) for chilren of all ages. A pretty town, a quiet, safe, sandy beach and a full-of-character child-friendly pub/restaurant with a playground were all within 10 minutes walking distance. Although I wouldn't say it was a luxury destination, the hotel served our purposes very well.
I had been trying to find a hotel that offered babysitting services, or even a kids club, as opposed to baby listening. None came up a the time, but I think a deep dig might have uneathed them. I'd be most interested to hear of any.
There are also three camp sites on the island, so I am told, all previously run by Haven Holidays. They are situated at Shanklin, Ryde and Cowes and they have babysitting and kids clubs. I think you can use those cheapie Sun's holiday tokens for them, so very inexpensive.... Has anyone been to one?
Hope this helps, and I will be very interested to hear more about the island from those who are more knowledgeable, like Viv and Marina.