First off, I would agree that Houston is the closest thing to Hell on earth (especially towards late summer). Why do people enjoy the hot humidity so much? Yuk.
As far as vacation suggestions:
I would send the kiddos off to the grandparents house for the week while my wife and I head to Vegas. It costs under $600 for airfare & hotel which leaves $1400 for shopping, black-jack, poker, etc.
That's what my wife and I did back in June, but it was a combined celebration of my wife's graduation & our anniversary, so needless to say it was a chance to get away for a bit.
As far as traveling WITH the kids, I would suggest San Diego. There are so many things to do there that cost NOTHING (the beach, visit Old Town, cruise the Pacific Highway, etc), and leave the one big event as the Zoo or Sea World. If you want to save money on lodging, I would suggest looking up vacation home rentals instead of hotels. My wife and I took our oldest son back in 2006 (he was 10 months old) and stayed in a beach-front apartment for about 1/2 the cost of a Super 8 hotel. Best part was that it was a complete apartment (full kitchen, 2 bed /2bath, seperate living room, patio) and was all within a gated community that had a pool, clubhouse, and "community" grills. I wish I was typing this from my home computer so I could provide you with a link to the website that set this up for us.
Another place to visit would be here in Colorado. You could easily burn a week doing relatively cheap stuff in the mountains (biking, hiking, fishing, sight-seeing, etc). I would suggest making this trip in late August / September to coincide with the fall colors.