Hi 4800 Patrol
We are from the Central Coast and only recently went to The Island Holiday Village to check out the place in the view of camping there out of holiday times. We went up there in the peak of the school holidays, and even though it was busy, it still looked really nice. Only stayed there an hour, but I would be happy to stay there again.
They are situated right on the western side of Port Stephens, so you are on the lake side, but only about 5 mins drive to Anna Bay and One Mile Beach. Controlled pets are allowed, but not on the main beach area in the park. Do you have pets?
The foreshore looked really nice, littered with trees providing really nice areas of shade while kids, if you have them, played on the beach.
From what we saw, I was really impressed. The only thing however, is it is located down a dirt road coming from the main highway. Not too rough though so it didn't bother us.
Hope this helps.
Be happy - take the family camping.