T. ~
We went to Cabo last year for vacation and it was just fabulous. I'm not sure what there is to do with small children, since we didn't have any with us, but the water is fabulous and I'm sure there's stuff to do, even if it's just hang out at the beach and enjoy.
The drinking in Cabo is just fine, not like most of the rest of Mexico. Especially at the hotels and restaurants, so don't worry about that stuff.
By the time that you go, flu season should be over. If you go without your children and you get exposed, you could bring it back to them and they'd get sick without even going. So honestly, if you're worried about the flu part, I think that it wouldn't make any difference if you take them with you or leave them home. Maybe ask your doctor what the risk would be either way at that time of year.
It amazes me how much you're being criticized for thinking about vacationing without your kids. If you do, they will be fine! The newborn will not remember it (memory starts around 3 yrs old), the 18 yr old will love it (LOL) and the 3 yr old will get through it, their memory span isn't that long. My friend won a cruise before and we watched her small children and they had no problems after they came home.
I think that either way would be fine. But if you were originally planning on taking them, then take them. Have a great time there!
btw ~ food there is expensive, so try to eat in. One place you should take them, though, is El Squid Roe...you all will have a great time there!
D.