If I were staying that long, with that many people, I'd definitely want a condo/house. There's something nice about being able to sit on a couch, not a bed when you want to watch TV. And having your own kitchen will save you a lot in time and money, even if it's just breakfasts and some dinners. If you're traveling with kids, it's nice to put them down to bed and then relax together, as opposed to finding someplace with many connecting rooms or public space.
We rented a 3-bedroom condo on Mission Bay through someplace we found on VRBO. and were very happy. Mission Bay isn't quite as "hip" as Mission Beach or Pacific Beach, but it was beautiful and the bay was right out the door of the complex. Our kids had so much fun. I thought it was close to freeways and downtown. I don't think anywhere except Legoland was more than 15-20 minutes away.
Good luck with your hunt!
PHXscuba