I suppose it depends on where you're staying although you may not have booked the hotel yet. I stayed at the Greigo Mar a few years ago - never again! As you said, Torremolinos is hilly (some feel like mountains when you're walking). The Greigo Mar is "up the top" and is near to the shops and if I'd known the layout of Torremolinos I'd never have booked it. Don't get me wrong, the hotel itself is OK, it's just the position it's in. If you like being in amongst the shops and busy roads then that's OK but, with small children, you'd be better off in a hotel that's near the beach. The main way down to the beach from up by the shops is down a very busy narrow street called San Miguel. It's lined with all sorts of shops you can look in on the way down the hill, quite steep in places. There are cobbles and steps on the way down and the walk is probably a mile or so from top to bottom and would be a real killer if you're pushing a pushchair. When you do get down the bottom there are several hotels right by the beach and the beach and promenade are very nice and flat. The trouble is, apart from the hotels, a few restaurants and small shops, that's just about all there is down there but I feel it would be better to be down there than up the top if you have young children. There are lifts in a couple of places so you don't HAVE to make the long walk down and back. The local train station is in the centre of Torremolinos and from there you can go towards Malaga or down to Fuengirola where it terminates. There are plenty of stops along the way with access to nearby beaches.

I have stayed in Torremolinos, Benalmadena and Fuengirola and I have to say that I far prefer Fuengirola as the other two are very hilly. Fuengirola is mostly all flat and has a long promenade and huge beach. Although Torremolinos also has a huge beach, it's spoiled by the hills.

As far as entertainment is concerned, in Fuengirola there's a zoo although there is also Paloma Park in Benalmadena which I've never been to but have heard that there are animals roaming around freely which children would enjoy. There's a place just near the airport called Plaza Major which is a collection of shops, restaurants and entertainment and they have at least one childrens play centre with ball pond etc. it is on the local train line and has its own station. By the way, the train station for Benalmadena is way up in the hills and a very long walk to the beach! Hope this helps with your planning.