Just a couple of ideas for things to do in & around Benidorm....

Terra Mitica (theme park) is great - only a few mins drive from Beni. My mum is definately not a fairground sort of person, but went on pretty much every ride there!!

There is also a waterpark in Benidorm - have never been there, as it is always closed when I go, but I'm told it's quite good.

Take a walk up to the viewing platform between the Levante & Poniente beaches - great views from there. There are a few good bars/restaurants where you can sit & admire the view.

We hired a car a few years ago and had some great days out in the surrounding area too - wine tasting in the Jalon valley, walking up Calpe rock (exhausting but worth it!) and te Algar waterfalls are definately worth a visit too.

Have stayed in a few places, depends what you want really. It suits us to stay in the Rincon de Loix area (Levante beach) as there's lots going on iterms of entertainment. It's very varied - as loud or quiet as you like.

We usually try to stay in the Acuarium apartments, as they're fairly central for everything, but far enough away from any loud clubs/pubs.
The apartments are lsited on quite a few websites, but probably best to phone the managing agents direct (Nuevhogar). They are based in the same building as Acuarium II apts. Their number is on their website http://www.nuevhogar.es (which isn't working at this moment!!)

Hope this is helpful - enjoy your holiday!!

You'll find most of the bigger hotels are fully booked until October. When I went "on spec" in September a few years ago I tried about four before I finally tried the two star Hotel Perla. I have to say I was pleasantly surprised and stayed there for the whole week. It's perfectly located a couple of minutes walk from the square. I didn't eat there so I can't comment on the food, but the room was nice and clean.
http://www.hotelperlabenidorm.com/