we are spending a week on BI and have booked 3 nights at Volcano. Any thoughts on the best area on the Kona side to stay for access to good snorkelling and beaches for family with 2 kids (8 and 10) . ( I got confused on VRBO with all the different districts and didn't know where to focus my search!)

The most popular is the area south of Kailua Kona. There are several hotels and condo's down that way. Not many beaches though, most of the coast line around there is lava rock. The disappearing sand beach is at about mile marker 6 (six miles south of Kailua) and there is a small sandy beach at Kailua harbor.

If you are thinking condo, I suggest the Kona by the Sea. Their one bedroom two bath units with a folding bed is great for kids and reasonably priced.

A nice sandy beach on the Kailua Kona side is Hapuna State Beach. As the previous poster mentioned, many of the beaches are lava rock, but this one is not.

For a family with 2 kids your age I would recommend the Hilton Waikoloa. In addition to the private beach lagoon they have 4 pools with slides (even fun for a 36 year old) and Dolphinquest. The beach is minutes away if you want the waves and the weather is always very nice. They even have a day camp at the hotel for the kids. You travel to your room either by boat, monorail or by foot. It is a big compound.

Ditto the Hilton--your kids will love it.

I gently disagree with Spokaneman regarding the most popular area around Kailua Kona. I think it's north of the airport.

The hotels south of the Kona Airport tend to be budget to moderate properties, mostly lacking sandy beaches. Even those hotels that claim to have beaches (King Kam for example) have what I would consider to be a mud flat, not a beach. Kona by the Sea has decent condos, and the Ohana Keauhou Beach Resort is a good solid 3 star hotel.

The hotels north of Kona Airport are more expensive, and have fabulous beaches, as they are all man made...it doesn't matter, they're gorgeous. And they get better the farther north you go. The island is really too young to have made its own sand, so it was brought in. I agree with those who recommended the Hilton. It's a bit large for my taste, but the kids will love riding a monorail or a boat to their room. Just remember that if they want to swim with the dolphins at DolphinQuest, they need a reservation in advance. There hasn't been a lottery to get reservations there in years.

We stayed in a VRBO rental in the Keauhou area south of Kailua Kona. Nearby Kahaluu Beach was great for snorkeling - lots of fish and perfect for kids. I agree Hapuna is also a great swimming beach, but not for snorkeling.

We had wonderful snorkeling at Hapuna last summer at the north end of the cove, calm clear water, easy access and many turtles. And, the Hapuna beach and the beach at Mauna Kea the next cove over are NOT manmade! That soft warm sand is all natural.

A great condo complex just south of Kona is Sea Village. We've stayed there three or four times, in a two bedroom/two bath condo with a beautiful sweeping view of the ocean, for a very reasonable price. It's a smallish complex, about 8 three-story buildings built around a garden with a pool and barbeque pits to use. Also free tennis courts. Not fancy, but very well-kept. We always have liked it over the others along that stretch.
The Sea Village units are individually owned, so Google "Sea Village" and see what you find listed by owner. I believe Donita's Vacations still handles one or two units, which is where we rented ours.

Four Seasons. Best real estate on the island.

thanks for your help - we're staying at a resort on Maui after this so we'll save the $$$ and do a condo south of Kona I think and try the ones you suggested

If you're looking for a condo south of Kona, try the Outrigger Kanaloa condos. The condos are huge.