We've done this twice, and it was great both times! The first time we took our own bikes (Dutch ones, natch) with us, and went on the ferry from Harwich to Hook of Holland. We then spent 10 days cycling in a big loop, including stops in Delft, Utrecht, Amsterdam, Alkmaar, Haarlem, the Hague and probably some other places that I've forgotten. Because we stayed longer in Amsterdam, we averaged 30 or 40 km on the days we were actually travelling, which was perfect: short enough to be done in half a day (and still have time for sightseeing when we arrived) but long enough to get from place to place. We mostly stayed with private families through an organisation called Vrienden op de Fiets, who at the time charged a maximum of €17 pppn and are happy to put up both you and your bicycle.
The second time, we did stay in one place (well two, actually) and hired bikes for day trips while we were there. We spent a week in the east and a week on the north coast, both in holiday parks run by www.landal.nl. They're like less posh versions of Center Parcs and because we booked at the last minute we got them for a couple of hundred Euros per week (although this was about 5 years ago).
Both holidays were great and I'd do it again like a shot, even though we were just a couple then and now have 1 (soon to be 2) DC. The Netherlands is brilliant for cycling for lots of reasons: flat, tolerant of cyclists, huge network of cycle paths, compact country so towns v close together. It also seemed to be pretty family friendly, from what I saw. And best of all, you can eat cheese and waffles all day 