Katherine is correct regarding the MR cruises being a bit more dressed down (to the dismay of some...but no big deal to others); however, with the holidays and all, maybe some more people will dress up(?). We always do early dining and I don't think I've seen more than a couple of tuxes in 4 cruises. Maybe the late seating people dress up more(?).
For men, we've seen the gambit from nice suits to slacks and an open collar shirt. The ladies always seem to dress up a bit more (at least to me anyway). Most people seem to make an effort to dress their kids up at least a little bit, but as a parent you know that doesn't always go over so well. I guess as long as it's reasonable, whatever you're comfortable in is fine...after all, it's your cruise!
The nice thing about formal night is the photo opportunities. If you're like us, we don't get the whole family dressed up (and happy about it) very often, so you might score that elusive "perfect" family photo.
Here's a photo hint for those with younger kids. The club and lab switched over recently to ridiculously bulky electronic wrist bands for the kids. You may want to carry a small set of scissors or clippers to cut them off for photos (and excursions). You can trash the band but don't lose the actual electronic device or they will charge you for it. The next time you take them to the club/lab, the CMs will print a new wrist band and put the device back on your child. Just takes a few seconds. If you elect to keep them on, the photographers will generally attempt to pose your kids so the bands are covered; however, I'm sitting here right now looking at an amazingly cute picture of my kids, except for that tacky wrist band sticking out on one of them (lesson learned the hard way!).

Paying this week!