The biggest consideration is the itinerary.
Castaway Cay is a huge attraction on
DCL, and some of DCL's 4 and 5 night cruises out of Galveston don't go there. Imo if you're shelling out for a
Disney cruise (that isn't going somewhere as special as Alaska or Europe), you should get a stop at Disney's wonderful private island, which really is a different experience from other Caribbean/Mexican/Bahamian ports. So if your prospective 5-night doesn't go to Castaway Cay, that makes the 7-night cruise a lot more attractive.
With the 7-night you traditionally get a character breakfast which imo isn't in the same league as the character breakfasts at Disney World or
Disneyland: fewer characters, less character interaction (they made you stay seated even before Covid) & the food is middling at best (you'll get a much better breakfast at an MDR or Cabanas).
You also get to participate in Animation Magic at your second night at Animator's Palate, which is really cool. Your server will give you a template to draw & color a figure on, and then will take it away. Toward the end of dinner, a show on sections of the walls of Animator's Palate will combine traditional Disney cartoons & your figure, which will be moving and dancing. Every person at the table gets to make one- it's real Disney magic imo.
Other than that, it's mostly just the fact that 7-night cruises are two days longer, so you will have more time to spend doing activities onboard / at ports, or just relaxing. My son and I actually prefer 5 night cruises to 7 night cruises, unless it's a very special itinerary like Alaska, because I tend to get bored after about 5 nights and my son starts to get homesick. 5-night cruises are actually perfect for us. But others have different perspectives on this.
In answer to your other question, we prefer the Dream & Fantasy over the Magic & Wonder, due to more activities & features on the Dream class ships: Aqua Duck water coaster (Magic only has Aqua Dunk, which is a drop down slide that is too intense for many), Midship Detective Agency virtual scavenger hunt, magical portholes in inside staterooms, miniature golf, virtual sports & virtual golf, a view out to sea in the Rainforest Room & a hot tub in the Rainforest Room, satellite falls, a young kids' splash area, two family pools instead of just one, an upcharge sweets shop that is very good, etc. We've also had better service on the Dream class, but that isn't universal, probably just coincidence as quality of servers varies widely even on the same ship. Also, the Dream's Beauty and the Beast is the best show we've seen on DCL. The Magic's Tangled is in second place for us, though.