Swan/Dolphin
Pros: walking distance (or boating distance) to two parks is the biggest selling point. This makes it VERY easy to pack up kids for a break back to the hotel. Pools are lovely, and DD would probably love the waterslide. Adults will appreciate the hot tubs. The resort fee gives you water bottles (great to take to parks and avoid the overpriced bottled water there), rides on the swan boats, and a s'mores kit for marshmallows roasting each evening. We were upgraded, and there was so much room to spread out. Additionally, our platinum status got us breakfast for two each morning, which meant we got a free character breakfast in Garden Grove (okay, the cold breakfast was free, but we upgraded the kids to hot so they could have Micky Waffles). Beds in the Dolphin are double beds (but can accommodate a rollaway) and queen beds in the Swan. Rooms open to interior hallways, and it's easy to get to the lobby and onto a bus and stay dry, even in a downpour.
Cons: it's a regular hotel, not that different from other Stariott properties in terms of theming. Pool area does not have lifeguards, nor does it have a real splash pad (though there is this little seal statue that squirts water). No planned activities that scream "Disney."
AoA
Pros: amazing theming! Kids will get a kick out of walking around the resort and seeing their favorite characters. There are several themed playgrounds, which would be nice for both children. Pool has lifeguards and a splash pad for your youngest. There are CM-lead activities daily to liven up a resort day, and a Disney movie at night.
Cons: requires a bus (or your own car) to get to the parks, which can mean a cumbersome trek back for afternoon naps. Little Mermaid rooms are kind of far from the central area, so you'll have even more walking in addition to the bus ride. Rooms are fairly small and basic; no upgrade like you'll probably get at the Swolphin. The Big Blue Pool has the cool underwater music feature, but at the end of the day, it's just a basic pool with no added amenities like slides. Beds are doubles, not queens, and you have motel-like exterior doors, and are exposed to the elements when walking to the bus stop.
To be honest, I would probably go with AoA for your resort day. I think it will be easier to keep both of your kids entertained and safe. But I would also consider a split stay because you can walk out of a park and be back in your Swolphin room before you'd probably get on a bus back to AoA.
