I didn't add up the numbers like other posters nicely did, but since you're flying in, you should stay on-site. Sure, off-site hotels are cheaper, but then you have to add in the cost of renting a car (very expensive right now) and paying to park at the parks (also not cheap) or using rideshare, which can also really add up.
I also think Pop Century would be a great fit for you. If you start looking at Disney Deluxe hotel, you're going to be cutting your vacation very short, compared to the prices at Pop. And, for me anyway, longer is better.
Because of your budget, I vote against table-service restaurants. Stick with Pop's food court and quick-service restaurants in the parks. A grocery delivery would also come in handy, as perhaps you could have breakfast in the room, depending on what your idea of breakfast is.
Go during one of the low seasons. If you go at, say, Christmas week, you're looking at a huge expense for everything. Check out
mousesavers.com, which has a list of historic rates for all the on-site hotels, as well as a listing of historic discounts, including when they were released. If you can take advantage of a hotel discount, that will really help out your budget.