Fiona, I know the one you mean (i live in Northcote too). We have been there once during the school hols when DS friend from school invited him. Me and DH were surprised that it was a playcentre thingy when DS was invited because we have walked past many times and got the impression it was shut or only for private party hire. Now that we know what it is we will go there a few times I think - will be good when baby arrives for DS to have a run about and during winter mths too.
I did not think it was very busy either though and I went during the term break... I have been to these types of places in the UK and NZ and they sometimes are busy and sometimes not. As i have only been to the Northcote one once I cant really say - about half the table were being used and there were 1 -2 kids in the little kids bit.
The coffee wasnt great, but I was happy overall with the set up and admission price ( cause it was unlimited, some of those places have entry for limited time ie; $6 for 2 hrs).
Business wise, if I were running a place like that or owned it, I would have a few changes made. But as a customer I was happy enough.