Seattle's seafood is justifiably famous, but the restaurants can admittedly be a little stodgy and over-formal. For a more casual and family-friendly ambience, try Ray's Cafe, upstairs from the more formal Ray's Boathouse. You'll get the same amazing waterviews of Puget Sound, but lower prices and a more relaxed dress code and atmosphere. The food is still delicious, though, like this impressive salmon-and-pineapple skewer appetizer.
A kids' menu is available, and there are a few chicken and beef options if you have some non-seafood-lovers in your group.