Sydney is a good place and going with your family is just a great idea. While Australia is a "big country" the urban hubs of Sydney and Melbourne and their surrounding countryside can provide guests with days or weeks of wonderful experiences. Within two hours of Sydney you can be in the beautiful World Heritage Listed Blue Mountains, enjoying quaint villages or exploring a fabulous wilderness of this National Park area. If your desire is for fine food and wine then look for Hunter Valley tours. For the accommodations there, I would advice you to go with resorts united apartments and resorts which are independently owned and operated and are located in some of the most beautiful destinations.