We were just there - 11/29/2001 - 12/1/2001. In addition to myself and DH, our party consisted of my brother and his wife and their two little boys (5 yrs and 16 mo).
The weather could not have been better - it ranged from the upper 70's to low 80's during the day and mid - upper 60's at night. The average highs for this time are mid 70's, so we enjoyed especially nice weather!
IMHO, there will be plenty of things for your children to do. There is a "no-depth" swimming area for the 5 and unders that included a small slide, pirate ship and "squirting fountains". My 5 year old nephew just loved the water slide in the main pool. He's an "almost" swimmer and by the end of our trip, he was going down the slide without anyone at the bottom supervising. It did take him a while to get his nerve up and one of the adults did need to help him at the bottom for the first day. Believe you can get a life jacket at Eb & Flo's for the little ones. We probably should have done that for him, but he really didn't need it.
In addition to swimming, there is a playground, minigolf area, and quite a few organized children's activities. My nephew enjoyed the "unbirthday" party. Of course, there is also the ocean and beach to play on. It was also fun to watch the boogie boarders.
There's plenty to do - especially if the weather cooperates! It's usually a little warmer at VB than at Orlando. Here's a link to weather averages for December:
http://www.weather.com/weather/climatology/USFL0500?dayofyear=336
