Between the two places you mentioned, I'd go with Excalibur. Much better location for "walking" to a variety of resorts. The Stratosphere is way to the North, kinda on its own (esp with the Sahara closing).
Be aware that Circus Circus is a dump! When my kids were small, we would also spend time there, but it has been allowed to get run down and we don't even bother going there to gamble anymore.
I would add a visit to Hoover Dam (first thing in the morning, though, before the crowds and heat build) ... definitely a MUST! Red Rock Canyon is just west of town (on Charleston) and is definitely worth the trip ... but it is the desert, so be mindful of the heat (we normally visit in either Dec or March).
I'd check out what coupons are available. Use Tix4Tonite if going to shows. We purchased an American Casino Guide (available in bookstores) and used some of their coupons. Also a wonderful website for saving's opportunities:
http://www.vegas4locals.com/coupons.html
We always take lots of Nathan's coupons ... its buy one item, get one free. Usually two of their sandwiches are big enough to feed 3-4 people ... cost $10.
The Unofficial Guide to Las Vegas is a good book to read as well. It will give you insight into the "free" transportation that is available along the strip (e.g. tram connecting Mandalay Bay/Luxor/Excalibur and Monte Carlo/City Center/Bellagio) which can save you lots of walking.
Don't forget to visit the lobby area of Bellagio and garden area!
Oh, the King Arthur's dinner show at the Excalibur is so worth it with kids!
Have a great time.