Congrats!
Heat training -- yes! acclimate in the final 2-3 weeks.
Ocean Swimming -- Kailua Bay can be choppy, other times relatively calm. Depends on the day. Get a feel for it several times race week and do some open water ocean swims before that if convenient.
Where to stay -- I have always stayed in a VRBO house or condo along or not far off Alii north of town. Between Kona and Keahou. I'd recommend that, you'll have your own kitchen and be close but not too close to the craziness.
Take your bike. My Ruster Henhouse has more than paid for itself in saving me on bike fees. If you're not mechanically inclined, Velofix is on the island and will show up to your place. Make an appointment well in advance.
I'd get there a week in advance to acclimate to heat, enjoy the week's festivities, and have everything ready to race.
Take your kids! I went in '17 after a long hiatus from Kona and the primary reason was for my kids to see it. They were 8 and 5 at the time. They'll never forget it. The Kekei dip n dash and parade afterwards are not to be missed for kids. There's a fun run if your kids aren't comfortable in the water. Sure kids are always a hassle but worth it.
Activities: Dip n Dash for the kids, Parade of Nations. Assuming you're American, USAT has a party after the parade with some cool giveaways - I won a pair of Jaybird headphones as a door prize. Underpants run looks fun though I've never participated. Pre and post race banquets are meh in my opinion but you may want to go as a first experience. There's a swim at the pier a week before the race but I've never been there in time to do it. Beyond the race activities make sure you and your family get to relax to enjoy the island. See the sights, especially the volcanoes, cliffs at Waipio Valley, hit up a Luau, consider a snorkel cruise. Keep it fun for your family and don't be all about the race.
I race poorly in the heat and I don't live at elevation, so I'm not a great person to ask. I can tell you my bike power in Kona was about 20% lower than my qualifying race. Run was about 1'/mile slower. This is hot sea level vs. cool sea level so doesn't factor elevation.
Other tips: two IM races in a year is a lot physically, mentally, financially, and with the devotion of time. You're obviously fit if you qualfield at Boulder. Stay conservative with your training, scale it back for now and ramp up briefly and taper for the race. Don't risk injury, burnout, or overtraining for the sake of sticking to a plan. Rest, eat well, train smart, and take care of yourself between now and then. Everyone is crazy fast, and you probably won't podium. Kona is special. Enjoy the experience.
http://www.desotosport.com http://www.ceepo.com