Where to Stay--Kuta
Kuta is a low-rent version of Las Vegas, only closer to the ocean and without the gambling. The hotels are generally noisier, closer together and (and this is the good thing) less expensive than other places on Bali.
We saw more people in their 20's in Kuta than other places, and saw very few parents with children. There are more bars and nightclubs, more places to buy junky tourist stuff (most trashy: little surfboards, about 8 inches long, airbrushed with dumb phrases like “Visit Kuta”) and things that cost money for fun, like video arcades and cheapo water slides.
For prices (as of 8/00), you could find a hostel-like places for maybe US$10 or less a night, on up to the Hard Rock Cafe hotel for like US$120 a night.
Same spread on food—from McDonalds with U.S.-like prices on up to imported seafood with prices with many, many zeros. The other guests in the area seemed to be mostly from Australia, the U.S. and Western Europe, with a very few Japanese and other East Asians.
Kuta claims several McDonalds, Dunkin Donuts and KFC restaurants, and a wide range of food stores and shops. There were also local boys walking around saying things like “hey sexy lady” in voices loud enough to provoke questions from our eight year old that we really did not want to address on the sidewalk.
For kids, the beach was wide and clean with lots of sand to dig in, but the waves were rough and the water not really swimmable for our eight year old.
To be fair, on the positive side, Kuta is near the airport and prices were lower than other places so I can't say it was all bad; almost all bad I guess. It might have been cool when I was 25, but at age 40 with two kids our short visit was enough.