I went to North-South Lake once a few years ago....to see fireworks while camping at Mongaup Pond, nearby. I found the sites at N-S Lake to be a little close together for my taste. Mongaup Pond is a smaller park, but still pretty big. It has lovely, more private sites right on the lake (I think "pond" is a misnomer). I've never been camping with kids, as DD is only 2 months old, so maybe being closer to a lot of people/kids is an advantage? If you decide to go with Mongaup Pond, N-S Lake is close enough for day trips.
Amy, proud Mama to my girls Natalie (12/7/06) and Miranda (2/9/10).