I think what is best depends on what you value most, if there are any fussy eaters and whether everyone in the party will share the load, or laze around expecting you to run round after them and moan if everything isn't to their liking.
We've found the best balance for us, which won't necessarily be the same for you. But, we're child free and DP pulls his weight with cooking, washing up/dishwasher and certainly when it comes to carrying beer back from the shop 
We tend to go self catering but might choose an apart hotel with breakfast included. We will always choose somewhere walking distance from food shops, restaurants etc and a kitchen. We usually go to Spain/Canaries/Balearics in quieter places, for example our next holiday is Santa Eulalia in Ibiza.
Having tried it once, because HB was only about £20 each more than B&B in the same hotel, I realised that I don't like buffets for dinner and if the food wasn't to my taste - I like fresh local food not processed meat, beige and chips it would ruin the holiday for me. I also like to eat outside and be served a meal at a table, same for lunch, but I don't mind (and quite like) a buffet breakfast.
I don't want to pay for the kind of AI that has a la carte restaurants and don't want to have to book in advance, rather go with the flow on the day. We also go the beach, waterpark, boat trips and take trips out to wander round other towns/cities, so wouldn't be at the hotel for lunch anyway.
So we'll stock up with drinks, snacks, maybe ice creams, breakfast supplies and some easy food eg for a BBQ from the shop and then eat out at least once a day, usually one full meal and the other maybe drinks and tapas, or a slice of pizza, or maybe just an ice cream for lunch if we've had a decent breakfast. Works for us and cheaper than a la carte AI but a nicer experience than a mid range buffet style HB/AI.