Everyone will have their favourites, but you might find this quick guide (also see photos and webcams) useful to help you decide/plan
http://www.lake-district.gov.uk/index/visiting/planningyourvisit/whistlestop.htm

Lovely to go out on a boat
http://www.lake-district.gov.uk/index/visiting/coniston_boating_centre.htm

My personal favourite is Wastwater and surrounding area and some of the most dramatic scenery
http://www.visitcumbria.com/wc/wastwtr.htm
http://www.lake-district.gov.uk/index/visiting/planningyourvisit/whistlestop/aroundwastwater.htm

Hi Swaran, the Lake District is a lovely place to go for a short break, you do not say how old your children are but there are many things families can do apart from Driving all day.
Coniston water has lots of activities for families, rowing canoeing even electric boats to hire, they also have launches and a fantastic restored steam gondola. There are walking and cycling tracks around the lake as well.
Windermere have the usual boats,walking and cycling tracks plus an adventure playground.
The visitor centre at Brockhole do things for children like treasure hunts and adventures.
The Lake District has a lot to offer and is a beautiful place as well, I could go on all day with things to do and see.
I hope that you and your children have a great holiday

Wastwater is beautiful..a long trek to get to but so worth it when you get there.

anther place we like is Devils Bridge.

Don't forget to visit Beatrix Potter's house at Top Sawrey not far from Ambleside (a lovely village), and also Sarah Nelson's Gingerbread shop in Wordsworth's village (? Grasmere ?); his house is worth visiting too!!

Dove cottage in Grasmere where William Wordsworth wrote a lot of his poetry is another place to visit.

I had forgotten about the gingerbread shop Alsacienne, gingerbread as it should be