On our last trip we took my turning-4 DD to Pat E Cake, lunch at Ariel's Grotto, and the Aloha breakfast at PCH Grill. We told them when we made our reservations that it was her birthday and they said they'd do something special for her...but all she got was a little generic flimsy bday card when we checked in to the Aloha breakfast and nothing at Ariel's. I've heard others who get a free cupcake with a candle and they sing happy birthday but that may just be at Goofy's (we haven't been there yet so I can't confirm)??
As for the Pat E Cake thing, I thought it was pretty lame and way overpriced but the kids talk about it still as being quite fun and you do get a souvenir cup that you can take home with you which they love. The cake tastes awful and everyone in your party is required to pay for one, including parents, so take those extra souvenir cups too - you paid for them!

Mickey and Minnie come out briefly at the end for photos and a dance, but they don't do autographs. It is outside though, so keep that in mind if you're going on a hot day - we melted out there right along with our messy dark frosting!!! Oh, and the cups were filled with warm lemonade...yucko! You may want to bring some wipes or an extra shirt in case your child ends up with that frosting everywhere but the cake, like some of the kiddos there.
Having done both, my vote would be for the character meal, because like you said - at least they feed you! And, our kids loooooove character meals and talk about them as the highlight of their trip. We've had great character interaction each time with fun photos and great memories!!!