Al, you and Matt are spot on about ND filters for waterfalls. I have used a few in the past, and I have found that the best ones for my purpose are the screw on ones. The square filtered ones are great, but they get really expensive quick if you go for Lee big stoppers or something like that. I have found that the Cokin ones are good entry level. I had some HiTech 85's and they did the job well on a budget. I took this shot with a set of 3 stacked:
Arboretum Waterfall revised by rickztahone, on Flickr
However, some of the best results I have gotten have been with screw on ones because during editing I have noticed less color shifts.
Either way Al, the easiest way to have a family portrait with the silky background is simply to get an ND filter that allows you to get over 1 second exposure, preferably around 5sec or so. Then, if you have off-camera flashes, set them to rear sync wireless. No matter how slow the shutter speed is, the flash will freeze any motion from your family, but will burn in the silky background of the waterfall. Think of the light streaking technique.