We just did Nassau with a 6 year old and a 9 year old. After reviewing the options, we chose the glass bottom boat ride and I think it worked out pretty well. It wasn't too expensive and the kids really enjoyed it.
After we got off the boat, my daughter wanted to spend more time in Nassau. We were unsure about just walking off at random, so we grabbed one of the horse and buggy drivers. We had about a 15-20 minute ride for $20 and saw more of the city than we could have on foot. He even let my daughter take the reins for a few minutes. After the ride he dropped us a block off of the pier and we shopped for a few minutes, then walked back to the boat.