St. Helen/Rainier route 504 driving in August
 

If you enter St. Helen from the West. Can you drive 504 and exit at the East onto Rt 25 - side trip to Ape cave and then up to Morton for an overnight. OR do you have to backtrack to the same St. Helen enterence.
Doing Rainier the next day

No you can't.

You will only be able to go as far as Johnston Ridge Observatory since that is where 504 ends.

It is worth the backtracking! It is quite a long drive in and out but fascinating every mile. Stop at the visitor's center on the way in and get a map that shows stopping points enroute to Johnston Ridge Observatory.
The mountain was not visible the day we went but still a very moving experience; the force of nature is remarkable. It will be very educational for your kids.

And, you'll love Cannon Beach! Great beach for walking and searching and the town is lovely. Ecola State Park spectacular. We'll be there in Sept--can't wait! Try Pig-n-Pancake for breakfast. Have a great trip.

A bonus at Mount St. Helen's these days are the magnificent wildflowers. The frequent spring rains delayed their peak until now (at least they were at peak a week ago).

As noted it is a dead end trip. But be sure you have a clear day, not worth the drive if you can't see the mountain. Consider all day and stopping at the visitor centers, all worthwhile with plenty of interesting exhibits. From the south, the highlight are the lava tube walks, but a long way from I-5 and 504

I realize now I will enter St. Helens from I-5 and leave the same way. Should I drive for an overnight in Ashford or Packwood to do Rainier the next day before going to Seattle. Found accommodations in both!

I would overnight in Ashford so you can get an early start on your visit to Paradise before the daytrippers start arriving.

Where are you thinking of staying?

Don't know why I'm having such a problem with this. Either do the Visitor Centers on 504, backtrack to I-5 (I think the same road)and stay in Ashford at the Copper Creek Inn (only thing available). OR Rt. 503, Ape Cave, Cougar and the east side up 25 and stay at the Inn of Packwood with a pool and enter Rainier via longmire enterence? Remember kid 9,12,14
Thanks