I would go with Singapore/Malaysia, or just Singapore, since there’s so much to see and the island-nation is a delight for kids. I’m not sure where you are based, but airfares will also be somewhat cheaper for this sector. The dates you are considering are fine, though accommodation and airfares cost more during the Christmas-New Year break, so that’s something to keep in mind.
I recommend you stay at Hangout@Mt Emily (4-person private room from SGD 146), an OT favourite, with great food, a ‘children under age of 6 stay free’ policy, and easy access to the MRTs—very important when you’re managing within a sparse budget in an expensive destination. But be sure to book well in advance. Explore Sentosa Island (it will need a day to itself), Universal Studios, Adventure Cove Water Park, the Singapore Zoo, the Science Centre, the River Safari and the Singapore Flyer during the day; leave the Gardens by the Bay, Clarke and Boat quays, Marina Bay and Helix Bridge, the Night Safaris etc. for the evenings/nights. Little India, Chinatown and Arab Street can be done anytime. In fact, throw the discussion open and plan an itinerary with your family from www.singaporeforkids.com and www.yoursingapore.com to double their fun.
Hilly and charming Cameron Highlands is an overnight luxury coach ride away from Singapore. Kuala Lumpur is 4hrs from there, and Genting Highlands is a day trip from KL. For an idea of how much cruising will cost, take a look at www.starcruise.org/tariff-SSG.htm. The availability of time and funds will determine your itinerary; attractions are expensive in this part of the world.