thnx for the replies. Well we thought of using the camper van to visit the must see places , so dont think we will be going so much off the beaten track. but thought it might be an exciting experience for the kids, to live in a camper van for a week!(or maybe until we get to hobart and then stay at lodging) Dont think we will have this oppertunity again.
This may sound a very silly Q, but as a person who lives in a country where there is no concept of campervans or public camp sites, just wondering whether we will need to park at campsites, in order to have access to a 'clean' toilet/hot shower..or how does it work?
But with everyone recommending lodging, I think we are now leaning towards that too..

We would like to see the penguins up closer.. and have read that phillip island can be a bit of a circus. So was considering seeing penguins in Tas instead. But would PI be the better experience for kids? Will look into Bicheno, thanks Patty.

To access showers and 'proper' toilets you will need to stay at camping grounds - there are plenty to choose from. Your kids will enjoy staying in the camper for a few days ( its the grown ups who will find the conditions a bit cramped ;-) The weather should be fine though so there will be plenty of opportunity for the kids to get out of the van and run off some steam.

Phillip Island is, IMO, a circus. Unless you pay lots extra for an up close and personal, you will share this experience with hundreds of other people at quite a distance from the penguins. I think Bicheno is a much more relaxed and natural experience these days.

It depends entirely on the camper you choose to rent but some do have toilets and showers. In smaller campers this may be a combined area called a "wet bathroom" similar to a bathroom on a smaller sail boat. Larger campers will have separate toilet and shower areas. There are holding tanks for fresh, gray and black water and again the smaller the camper, the smaller the tanks so you have to pay attention to your water usage when you're not at a campsite with hookups. Take a look at some youtube videos on the process of hooking up and unhooking a camper (water/electricity/etc) at campsite and see if you're still interested in renting one. Or you can rent one without a bathroom and use the bathrooms at the camp ground. Also the larger the camper, the harder it will be to maneuver especially on winding roads and find places to park and the more fuel it will use so it's a tradeoff if you want more space.

nikidi - I can see the attraction of a camper for travelling with kids. however, as you will be coming fresh to this, I would suggest getting one for fewer days than you were originally thinking, having a bigger one than you think you need, and only stopping at places with proper loos and showers.

That way, if you don't like it, you shouldn't get too squalid and uncomfortable, and if you do, you'll have had a great experience.

We hired a camper van through Britz, Apollo is another reputable company.
We drove from Broome to Darwin over about 9 days, and thoroughly enjoyed the experience, no kids with us, but I reckon most kids would love it.

Ours was about the size of a VW Kombi, it struggled to reach the 100 km per hour speed limit, but was really quite comfy. Add ons included an awning which attached to the side, a couple of camp chairs and a BBQ.

I'd do it again, and Tassie would be even easier as the distances between places aren't so great.

Thanks all for your replies. really helps ..I was wondering if we could try out the camper van for only part of the trip as suggested ..but if so, where should we pick up and then swap to standard car..

We thought of flying in to Launceton and flying out of Hobart.
Our must visit places on the list right now are cradle mountain-lake st claire, Mt field np to see waterfalls, freycinet np, Bicheno for penguins.., sorell for cherry picking and some beach time would be nice. (I need to read more trip reports and route it! :) )

Any chance you'd consider a different time of year, say July-Aug? In a lot of ways December/January is crappy time to visit Australia - the coincidence of summer with Christmas/New Year make it a very busy time at many destinations. And it's hot almost everywhere, especially in the the tropical North and Outback.

My wife is Australian and over the years, we've generally taken our kids back to Australia during the US summer school vacation. It's a great time to go for most of the Australia, especially the North and Outback - generally fine, dry and warm, but not hot. And while you won't have beach weather in Sydney, winter days are typically quite mild - highs in the 60s.

Spring (Sept-Nov) and autumn (April-June) are also good times to visit, but don't line up with US school vacations very well.

Having just said all that, this year we will be going back in Dec for my wife's 60th. It'll be the first time we've been to Australia in summer in many years. We're not planning any excursions too far afield for the reasons stated above, pretty much sticking to Sydney and the Gold Coast.

Unfortunately , Dec11-3rd jan is our only possible dates.