With kids under 5, I'd use my fly-in city as a jumping off point and head to a smaller centre to settle in to something with a kitchen and nearby attraction--like a sandy beach or kid-friendly hiking trails. A week in a city with the under 5 set is do-able, but probably not relaxing. Plus, cities can get expensive when you have a crowd. It's hard not to get frustrated when a kid wants to leave a museum after 15 minutes because it's "boring", especially when you just spent over $100 on admission.
My suggestions for Seattle would be to rent a car and head over to the San Juan Islands. Most kids love ferry rides and each island has its own character. If you are feeling even more adventurous, take the ferry to Vancouver Island where you'll automatically get a 30-35% discount on everything because of the exchange rate.
Victoria and the Saanish Peninsula has a host of family friendly activities, beaches, and parks. If you don't want to rent a car in the States, take the daily direct passenger-only ferry between Seattle and Victoria that drops you off in the heart of Victoria in the Inner Harbour. From there you can walk, cab, or take local buses to get anywhere you might want to go. If you are interested, give me a PM and I'll send you an Insider's guide as to where to stay and eat, along with some of the best hidden spots for families with young kids.
If you fly into Portland, I'd head to a beach town on the Oregon Coast with the kids. Manzanita has always been our favourite because it is smaller and quieter but has a great beach. If you rent a car in Portland, it's a beautiful 1 1/2 hour drive over the mountains to the Coast. Pick a place to stay, then check out some of the beaches and towns that run all the way from The California border to Astoria. Very kid-friendly attractions with lots of sand, kite-flying, and ice cream stops.
