We used to go out there from Canberra for picnics quite often, it was a great spot.. Very busy on weekends, school hols etc. Have a look at the new dam while you are there!
I love this forum. I need to be in Canberra for a day or so in a couple of months and was trying to figure out where to stay apart from EPIC (good place but not that appealing).
And then Gunny asks this question. Responses pique my curiosity and I do a bit of research.
I found this and it certainly seems like a good spot to stay for a night or two while I visit friends in "public service central".
As well as all the stuff most tourists do, like the National Art Gallery, Museum and Dinosaur Museum, Parly House, War Memorial etc etc... try to get on a tour inside the Corillon on the lake. Its really interesting, and you get amazing views from the top. Check with the Canberra Info Centre, as those tours aren't run every day. Also very interesting is Old Parly house.
I passed by Cotter campground almost exactly 12 months ago (Feb 1) and it looked crowded. I wasn't planning to overnight there so didn't stop, and if I had been I would have kept going as it was too high-density for my tastes. There was also truck traffic to the dam construction at the time. It looked a nice enough location otherwise.