I wouldn't consider Yosemite right now. There's a fire burning in Madera that has the valley partially obscured, plus it has been an incredibly dry 3 years. It's best done when the valley is smoke free and the waterfalls are running heavily.

Yellowstone in August is pretty awesome for kids because of the amount of wildlife viewing available. Hayden Valley will still have lots of bison and elk that are easy to see. Up in the northeast corner of the park the grizzlies are moving pretty well. If they like this kind of stuff you can join horse tours near Roosevelt lodge, and there are plenty of waterfalls still moving adequately for a show. They'll get a kick out of the geysers (and their smell) as well.

If you have military affiliation make sure you bring ID. Most cards get you in for free. Also, if you're driving at dusk or just after dark, be careful. The deer play a game of "try to wreck the tourist cars" on the 2 lane park roads with limited sight distances. Might want to consider "walk away" protection for your rental car.