Hi
Wanted to report back. Thanks for all your suggestions. We have tried out most of them.
Stresa is a fab town, with plenty to keep us occupied. Our apartment was right in the centre about 2 mins walk from the fab Gelato place you recommended Novelsituation. We had one every day and made our way through the flavours!! Had dinner at Mamma Mia but didn't book so we had a table inside and it was soon hot but good food, should have booked.
The restaurants in the square were good but we found if you walked down some of the streets we found some good places which has more locals at.
The Friday market in Stresa was good in car park on other side of the main square. Also has a great little bakery which locals use open at 6am (not that we were out of bed then) daily. We bought heaps of chesse, meat and fruit and veg, not cheap but fab quality. Bought a roasted chicken was 13 Euros but DH said it was free range and corn-fed (can you tell he doesn't do the weekly shop) was delicious, made a nicevchange from pizza and pasta. Lots of stalls selling cheap tat, handbags etc. but few others selling nice shoes etc. Good mix. Finishes at 12 noon.
Great Carrefour supermarket just behind the main square, everything you need to stock up if self catering. Open from 9-12 then 3-7. Sun only 9-12.
DS' (and I) did swim in the lake bloody cold but water beautiful, clear and very clean. Little beach area just in front of nice kids playground.
Did the trip up Mottarone, really nice walk along the promenade from Stresa takes about 15 mins. Beware of rip off restaurant at top, food not great and a bit pricey they charged us 4 euros for the bread. Take a picnic!
Did trip on Railway to Monteldessa then to Locarno, get ferry round to Ascona much nicer town to have lunch at and wander around and then back on Ferry (this bit took 3 hours, go on a Wed on hydrofoil much faster) long day trip but so worth it. Amazing scenery through the Alps, DD's got a bit bored but we loved it.
Overall had a fantastic trip and it's a gorgeous place for a very relaxing holiday with kids. The Italians are so friendly and love kids, we will definitely come back again.