Have a ball!
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I can't understand some of the negative comments - but everyone's different I suppose.
I've booked again for the first two weeks in May and the first two weeks in October. This will be my sixth year, so 11th and 12th time visiting. It's so friendly and everyone seems to remember you - a sort of Greek
Cheers.
Although I don't think it's a resort for kids, there are always lots of happy ones running around so what do I know. To answer your specific questions:
1 Lindos is much on a par with the rest of the other resorts as regards to prices. You will find cheaper in the towns and villages, but not by much. I know of at least 3 restaurants which do daily 3 course set meals for approx 9 euros. You'll see the noticeboards out from about 3.00pm each day. All restaurants have a children's menu but these tend to be fast food orientated. If you ask for a children's portion from the main menu then the price is reduced.
2 All the restaurants, and there's lots, have menus which are Greek and Italian orientated. The Greek section is varied with all the old favourites to the fore. the only drawback is most meals are served with rice and chips - but just ask for these to be left off your meal. There are Indian, Chinese and Cypriot restaurants also.
3 There are 3 ATMs - one at the donkey station and two near the bank.
4 There are two main sandy beaches, Pallas Beach and Lindos Beach, which has a small area which can be used for stretching out the towels. Stay away from St Paul's Bay - it's ours, quiet and peaceful! Seriously, it is a quieter pebble beach with a rock-filled sea. Better for adults.
5 The choice is yours...there are no water sports at St Paul's Bay.
6 There are too many to mention and the fun is in finding one you really, really like. There are probably no bad restaurants. My favourites are Dionysis, Kalypso, Stephanos and Caesars.
7 Except for Monday when it is closed, any day is good. Go either very early or about 3.30 when it is cooler. (Lindos is always 4 degrees hotter than the rest of the island). Also these times ensure that you miss the daytrippers. If you go, take the route through the shops as it is cooler and less of a climb.
8 To be honest, don't bother with the tours and do it yourself. You'll save a fortune. For example, A day trip to Rhodes Old Town (a must!) will cost about 17 euros but you can go by local bus for 3 euros each way, and it drops and picks up outside the Old Town entrance. Bad news for your husband though, there are literally hundreds of shops built into the old streets. Use the local bus service - it's reliable...ish for Greece and is great fun.
9 Greeks love children and the people of Lindos are no exceptions. You'll be able to take them anywhere, at any time, and I bet they're fussed over.
As regards entertainment though, I can't see anything for them except the beach. But remember that Faliraki is only 30 mins away by bus and is a completely different child-friendly resort, inluding a great water park, by day and Pefkos is also only 10-15 minutes away.
I don't know anyone who's only been to Lindos the one time. If you go once...you eventually go back. Have a lovely time...and if you go to Yiannis Bar tell Kostas Danny sent you.