We were 2 families of 8 people total and there was plenty of space if you don’t mind sleeping in same room as your kids. Great, huge balcony overlooking pescaluse and the ocean. we spent most of our evenings out there. You need a car. Pescaluse is about 3-4 minute drive. It is walking distance but I wouldn’t walk on that road. Has all the amenities you need and wifi.
If you like snorkelling, i recommend driving to leuca and finding some good spots near grotto diavlo which you can walk down to or there are some natural pools about 20 min away On the other coast.