The family vacations I have been on are pretty much as Dbyers described.
The state of Hawaii consists of several large islands in view of and a short airplane flight apart. The state consists of the big island of Hawaii, and the islands of Maui, Oahu, Kauai, plus the small islands of Molikai, and Lanai... and thousands of other little islands in the chain.
Hanalei bay is on the island of Kauai, large cove with equally large sandy beach, small residential neighborhood with many houses for rent, three or four blocks away from the beach is a two lane highway with a small supermarket, and a few shops and restaurants.