There's a lot of things in the NF area for all ages. Almost all can be done by the entire family. When we took our kids, we went to:
The Falls...
Cave of the Winds
Maid of the Mist
Prospect Point/Observation tower
Goat Island
Aquarium of NF
We then went by car northwards and visited:
Whirlpool park
Devil's hole park
Hyrdo-Electric plant (there's a hands-on museum thing there)
Fort Niagara (one of the oldest forts in the USA).
There's also casinos on the Canadian side but we didn't go. Daredevil rides in the area as well.
Here's a site with all the info.
http://www.niagarafallslive.com/index.htm
To get some idea of costs: For a family of 5, total price:
5-parts of NF = $100 or so (buy the pass that gets you the things listed above for the falls as a single book and transportation between them for a day).
Fort Niagara - $32
State parks = free
Hydro-electric plant = free (or really cheap, I don't remember).
2 nights in NF hotel = $200 (There's a Comfort Inn right at the entrance of NF that has rates under $100). It has a pool, restaurant, free parking... It was just converted from a Sheraton a couple years ago.