We absolutely prefer to stay on-site for the convenience - most of which was listed above, but I'd like to add:
1) Early entry - I hear they're either back to it or going back
2) Sending your purchases back to your hotel/room is a BIG plus to me
(3) We don't have to carry extra shorts/shirts/coats around w/us because the hotel is so close if someone gets wet, dirty, cold, etc. we're not that far away & just rejust our schedule slightly.
(4) Also, I love to take pictures with the still & video camera - but not ALL day & night - so I plan our sched. around this, too & then take the cameras back so we're not lugging them & don't have to fear losing or breaking them
First & foremost it's the 'magical' experience & the ease of transportation, but you would like the overall convenience of staying on-site. Nothing ruins a fun (& tiring) day more, to me, than fighting the crowds & traffic out of the park & taking 10x as long to get back to the hotel & then start it all over again the next day.
We've stayed at just about all of the on-site hotels before (& are doing All Stars & Beach Club this Oct/Nov) & we've stayed in Downtown Disney 2x and off-off site & we would much rather stay at a cheaper Disney on-site hotel than the others.
We really liked the BW Suites (Orlando), but again, traveling time & inconvenience, cost to park, etc. is a hassle.
The DD hotels were very nice & easier transp., but we still feel that being right there in the park is so much better.
As was said, the All Stars are not plush hotels, but they are very, very nice & kids just love them.
As far as food - we drive down, as opposed to flying - not walking, specifically to have the room to bring food with us such as juice cartons, snack packs, cracker packs, fruit, cereal boxes, etc., etc. to use in place of buying the VERY expensive park food.
Here's how we've done it (whenever we drive):
Cereal & fruit before we leave hotel in a.m.
Put juice, water & snacks in backpack for throughout the day & just buy a small food item & ice cream
Dinner we go big - but we all LOVE to eat out so I know this before we go. A 'hamburger joint' would save on $.
Staying at the All Stars makes it easy to just bring our cooler into the room & change the ice once a day.
Have fun!!
