We used to spend a week every summer at a place called Portage Point Inn in Onekama, MI when I was a teenager. They feed you twice a day and have two lakes (Portage Lake and Lake Michigan) and a pool. The closest "big" city is Manistee.
Now in 1993 and 1999 my family spent a week in Elk Rapids (near Traverse City) at White Birch Lodge. They also feed you and they have water sports but it is much less formal. DH was bored--the summer after was our first trip to WDW because he said he'd never sit on a beach all week in Michigan again.
I second that Put In Bay is a more adult destination in the summer, but during the week it is OK for families. At night and esp. on the weekends, though, it can be a big drunken mess.
Robin M.