Would be a good idea to sticky a Gulf Shores thread, as it comes up frequently.
We (wife, kids 8 and 11) were there last week (4th year to go). First 3 times were post-Labor Day trips, and we stayed in GS. This was planned at the last minute, and we stayed in Orange Beach. Timing was perfect, as nearly all Alabama counties had started school the previous week. We almost had the beach to ourselves.
We got to do some new things this year:
-Visited the USS Alabama. Just happened to go during the 75th anniversary, so they had a pretty cool reenactment with "enemy" aircraft and folks in period uniform.
-Stayed one night in downtown Mobile, which is actually pretty cool. Especially Dauphin Street. There are a couple of marine museums that we didn't get to yet.
GulfQuest Exploreum[url=http://www.exploreum.com][/url]
-There's a cool little nature center in Gulf State Park. Also a pretty big trail system (mostly paved) if you're into biking/hiking. A nice park staff member helped us get started on our first go at geo-caching.
-There were a couple of Loggerhead turtle nest near our condo. Unfortunately, they didn't hatch while we were there. One of them has surely hatched by now. Learned a lot from the volunteers who help out with this.
-Saw the Blue Angels practice. Awesome. The whole aviation museum is great.
-Caught a few blue crab while just playing on the beach (ate one).
Some favorites:
-Sea N' Suds is your basic fried seafood, but eating out on the beach is relaxing. I'm also a Shrimp Basket fan.
-For "nice" meals, Ship's Harbor is really good. We also like GT's by the Bay (formerly Cayman). Lulu's and the Hangout are fun for the atmosphere. Still a lot of places we haven't tried yet.
-Lambert's is worth going to once for the experience. The "free" rolls and family style sides are fun, but overall the food is like a more bland Cracker Barrel.
-The little zoo is fun. Small, and easy to see everything. Check the website for their current animal encounters.
-Renting a kayak on a calm day.
-September is fun b/c college football has started, and GS is like the Mecca of SEC vacationers.
We could make much shorter drives to Galveston or Port Aransas, but GS is much more enjoyable, especially w/ kids. It's just cleaner. Don't have to worry about stepping on dirty diapers, or dealing with punks blasting their music on the beach. People are nice. It's SEC country, so you're bound to see rednecks, but not white trash.
tl;dr - I like GS a lot.