VRBO is a pretty great way to vacation. I just got back from a large family reunion type vacation to Mission Bay in San Diego and it was fantastic. The most important thing is that the quality of vacation is so much higher when you don't have to constantly alternate between finding places to eat and huddling in a tiny hotel room. I prefer cooking anyway, and with a slew of kids, it is impossible to enjoy eating out more than maybe once during a vacation. We never did end up eating out, and fed the 12 of us for about $100 per day, which is not bad, considering we were eating steaks and drinking local microbrews the whole time. I can't even fathom the bill had we all eaten out all week like we would have to in a hotel.
One thing that made this last trip so great was that it was a place on the beach and it came with a whole bunch of toys for kids, ranging from a fleet of bikes to several kayaks, stand up paddle boards, surf boards, wet suits, etc to even the simple things like some buckets for making sand castles. There was 7 adults and 5 kids and we all had plenty of fun activities at our disposal that cost no extra money. Out of curiosity I got a pamphlet from the rental place on the bay and found that, had we rented the bikes, kayaks and paddle boards for the amount of time we ended up using them, it would easily have cost 1000+ dollars for the week!Of course we wouldn't have paid that, we would have just had a much less active and engaging vacation. We would be wishing we had a kayak or bikes, or sand castle stuff, etc.
So I would say, look for a place that specifically mentions that it has water toys and things for kids. These are pretty common in places that have a whole economy based on VRBOs like (in Florida) Sanibel/Captiva islands, the keys, etc. Some places cater to adult crowds with fancy sleek designs while others cater to families and load the houses up with fun stuff. Also, if you can find something in a good walkable neighborhood, the hassle of driving places will be lifted. We were 2 blocks from the grocery store and did not drive at all for 7 whole days and that alone made it truly a wonderful vacation.