We just got back from Maine yesterday evening.  We ended up staying at a place in Wells, as the hotel was a third of the price of those in Ogunquit and York.  The hotel was priced at $180/night on the website, $151/night on Expedia, and when I called and spoke to someone at the hotel I ended up getting the room for $135/night.  Great deal.  Two bedrooms (each with a queen bed), a living room with a full size pull out couch, and small kitchen. 
  
I just love the beaches on the North Atlantic coast.  The water is cooler, but the atmosphere is so unique.  My son had a blast running around chasing after crabs, and the tides created warm little tidal pools that were perfect for my 2 year old daughter to play in. 
  
We went to the Maine Diner one night purely because we saw it on Diners Drive-Ins & Dives.  It was overpriced and the food was terrible.  The second night we went to a great little place in Ogunquit, and had some of the best seafood I have ever tasted.  We went to a little "food truck" every day for lunch, and enjoyed fresh haddock, fried shrimp, and fried clams.  What a beautiful place, and only a 3 hour drive from my house in VT.  Thank you everyone for all the suggestions.  We are headed back in a few weeks to stay with some friends whose parents own a beach front house in Kennebunkport.