OK, just back from Alghero after a 12 day visit. I got a lot of good info from this site and from other places so I reckon I should pass on some tips while they're still fresh in my mind (hopefully this doesn't turn into one of those 'My Summer Holidays' essays from school days ;).
Getting there - Four of us (Mum, Dad, 2 kids - 7 and 5) flew with Ryanair from Dublin into Alghero. We were met at the airport by a pre-arranged taxi - more expensive than the bus but useful for handling bags and trying to find our apartment for the first time.
Accommodation - We stayed in the Residenza Buganvillea along the Lido sea-front. Pros - pool (essential for the kids), modern facilities, air con (extra but worth it). Cons - 25 minute walk into Alghero (good bus service though), some noise from restaurant downstairs (avoid an apartment overlooking the main road - nice views but lots of traffic noise).
Car hire - got a car for a week from Enrico Farris who had been recommended on this site. Excellent service (even collected the car from us after we were finished) but beware of the large excess and extra insurance costs. Driving in Sardinia was fine, drivers tend to quite agressive though so you need to go with the flow.
Alghero - The town of Alghero itself is split into old walled town and new modern town. The old town is very attractive and is well preserved. Lots of shops (not exactly cheap!) and restaurants (more on this later). Beautiful walk along the sea front on top of the city walls. We took a guided mini-tour on the little 'Catalan Train' which was entertaining. Also, there is a decent-sized park between the old town and new town (McDonalds on this side....) which has a very good, well-shaded play area for children.
Food and restaurants - there is plenty of info to be had on places to eat in Alghero. As we went self-catering, we did eat-in quite a bit as the local food is fresh and very edible. The restaurants we did visit were all pretty good, especially Paco's and Casablanca. Note: we did get out order mixed up once or twice so make sure you let the waiter/waitress know what is your 'primi plati' and what is your 'secondi plati' or else you may get chips for starters!
Attractions - Beaches all over Sardinia are excellent, crystal clean water, shallow and safe swimming and stunning views. The ones near Alghero are good but can get very busy (beware Sundays when every Italian In Sardinia goes to the beach on their day off, traffic and parking mayhem!). We found some beautiful spots further away, La Bombarde and especially Spiaggia Munoni (on the way to Cape Caccia) - this was our favourite in terms of location and views.
We drove over to the caves at Cape Caccia (Grotta Nettuno), well worth the visit. Stunning descent down the stone steps to the entrance followed by a guided tour of the impressive cave network. You can also get a boat from Alghero to the caves (entrance fee not included).
The kids persuaded us to visit the Parc Aquatico in Marina De Sorso on the north coast of Sardinia (about an hour and a quarter drive). A little bit hard to find but it was good fun. Some great slides and some smaller ones for younger kids although the wave machine was broken and another slide was closed for some reason. Very strict life guards. A good afternoon trip rather than an all-day one.
L'Ardia - We did a day trip to a local festival in Pozzemaggiore, about 90 minutes inland from Alghero. The drive there was stunning, hairpin bends for a lot of the way, then through wooded valleys and over bridges, most definitely a taste of authentic Sardinia. When we got to the town, at first we thought the whole thing had been cancelled, as we couldn't seen anything happening. Suddenly the church bells all over started ringing and next thing, we turned a corner to see about 5000 people milling about waiting for the whole shebang to kick off! L'Ardia is basically a big parade and horse race around the church and streets of Pozzemaggiore, with accommanying bands and guys shooting VERY loud blanks into the air. Great day, very entertaining and we were surrounded by locals. Found a tiny pizzeria for food afterwards and managed to order in pidgin-Italian.
Note: I found a neat Java app for my phone before I went which was very handy for Italian phrases and pronunciation (see http://www.getjar.com/products/3536/MobileTranslatorEnglishItalian)
Bosa - We drove down to Bosa, a 40km trip along stunning cliffs and sea views. The itself was very nice too, lots of old buildings and palm-lined streets. Made a change from Alghero.
Nuraghi Palmavera - stone age settlement a few km from Alghero, interesting if you're into a spot of archaeology and handy for a hour's break from the beach.
Overall - I would definitely recommened Alghero as a destination for a family with kids. If you're staying for any decent length of time, a car is very handy for getting into town in the evenings and for trips further afield. If you can, take the opportunity to explore the interior of Sardinia, a very different experience to the coast. Accommodation with a pool is also very handy when kids are involved, they had a great time.
This review is the subjective opinion of a Tripadvisor member and not of Tripadvisor LLC.