I recently stayed here with my two kids (ages 4 mo. and 2 yo.), husband, brother, sister, mother and father. There was more than enough room to accommodate all of us.
The accommodations were great. The bedrooms were big and the beds were comfortable. I rented linens from Sheets at the Beach, which I don't regret. The bathrooms, while they show their wear, were clean and the showers had pretty good water pressure. The extra long table in the patio was perfect (even too big) for my family for meal times. We spent lots of time cooking and eating in and found it to be a joy to use the kitchen and the outdoor gas grill. To our surprise, we found a booster seat and a bassinet in the house, even though we had rented/brought our own. My only minor complaint would be that the walls were pretty thin, which required us to stay quiet while the baby was sleeping. All in all though, I was very very happy.
As far as location, this place is great! The 1.5 blocks to the beach is easy walking, even while carrying an infant. The house is on a quiet street, but only a few blocks away is Rehobeth Avenue, which we frequented by foot several times a day. It was great to be able to just walk back and forth from the house to the beach, Funland, and all of the restaurants on the boardwalk.
The owners were very responsive and it was easy working with them.