Yes, ITA. Don't bring (or rent) a car if you can help it. Just walk and use the CTA (the "El" train) and buses. Here's a link to buy passes ahead of time or you can just buy them at the kiosks at any station:
http://faremedia.chicago-card.com/store/main.aspx?DepartmentId=34
Be aware that even with a CTA pass, you may still walk a bit unless you also utilize the buses. We usually just bring really comfortable walking shoes (and lots of socks and a few blister band-aids). Chicago is a big city, even if you stick to downtown.
Since you're going to be in the Navy Pier area, you'll have lots of hotel choices. If you feel like splurging, stay at the lovely Palmer House Hotel (owned now by Hilton). Opt for the Executive Level if it's in your budget as it's just lovely. Downer: only king rooms or rooms with two double beds -- no double queen bed rooms.
Consider NOT going to a museum on a "free day" (you can find out when these are on the various museums' websites). WAY too crowded. Unless it's important to watch your pennies, you'll enjoy the Field more if you don't go when it's free. As with Disney, try to be at the museum at opening time in the summer. You'll have a bit of a breather for the first hour or two. However, the Field Museum is "busy" to "very busy" during the summer although it's well worth a visit. Be aware, of course, that it IS a museum, so it will appeal to the intellectually curious. If your kids prefer "thrills" more (nothing wrong with that--just different), then they might be a little bored with too much museum time.
Do go to the Michigan Avenue stores. We love to walk and window shop in the summer, particularly if it's not a really hot day. Navy Pier is pretty fun (the ferris wheel is neat) even if it's fairly hot since, by the lake, there is generally always a breeze. Do some walking along the bike/walking paths in the various parks and along the lake. Really nice for a picnic!
For really awesome deep (really deep) dish pizza, you might try Giordano's (there's one about a block off of Michigan Avenue, a couple of blocks north of the Art Instititute and another on W. Jackson near Union Station). Be prepared to WAIT if you show up on a weekend night near dinner time. Of course, there are many other good restaurants in Chicago, but Giordano's has always been a big hit with folks I've taken there.
Have fun!