We stayed a week in Po'ipu, Kaua'i, August 2007. A very beautiful area, but don't expect a real 'town'. This area is made up of resorts, for the most part, restaurants, galleries and tourist shops. We found one little grocery which did the trick for the small stuff, and next door is the tiny Poipu Grill, a great littel takeout place for meals.
Nearby Po'ipu is Koloa, which has a bit more to offer, but we ended up driving to Lihue (20 minutes) to grocery shop - Costco there saved us a bundle.
Po'ipu was a good jumping off spot to go west to the Wimea Canyon, or north to sites along the Eastern shore. It was a bit of a trek to the north shore and Princeville attractions (60-90 minute drive depending on traffic which was a bit bad at times - who'd have thought!!).
Po'ipu Beach Park had ok snorkeling (we got spoiled on the Big Island before coming here) and good boogie boarding, as well as beautiful sand, the ubiquitous Kaua'i chickens, a calm area for little ones to get wet, and some decent surfing waves, nice grassey areas and picnic tables. We stayed in a condo only about 1/4 mlle away, so didn't have to deal with the parking, but it looked adequate if you are willing to walk just a little. The Marriot resort is just next to the Park, and you can walk their beach and paths, too.
We recommend driving north to catch a boat trip to Na Pali (we took Na Pali Catamaran - napalicatamaran.com - smaller boats with fewer people, less rough water and shorter trip when traveling from this direction). A really great experience with knowledgable guides.