As one poster suggested, and the others have at least intimated, do your research before deciding. The DISboards have very informative threads on almost any topic you wish to know a bit more about. Avail yourself of them and read up before making any concrete decisions.
One important factor to consider is when you will most often travel: is it most important for short term to consider your kids or the majority of years after they grow up and it's just you and DH? Regardless, that's a good starting point to determine your use year. As for the number of points, there are many variables such as what sort of rooms will you want (1BR or 2BR), when you travel, and how often among other things. Once you have decided what you are willing to pay, how many points, and your use year, then choosing a resort becomes the prime topic.
Each DVC resort has its advocates and detractors, though I've found them all to be wonderful, each in its own way. Some prefer the proximity to the action that, say, BWV provides. I enjoy the relative serenity and closeness to the MK that VWL possesses, so that's where I own (plus, it's perhaps the most sought after resort during the Christmas season, so I get an 11-month booking window there). Take a good look at each resort, ask questions on the particular Lovers' threads (pretty much all the resorts have a lovers thread in the DVC Miscellaneous forum), and decide which resort would work best for your family.
My suggestion is to have all those things worked out before considering buying direct or resale. At that point, you will have to consider which option is best for you. A direct buy from Disney means a simpler process, easier financing (if you so choose), and no loss of any current privileges. Buying resale almost always means a substantial savings of money (especially for older resorts), but incurs a slightly more laborious process since you must pass Disney's right of first refusal (ROFR) and may have to expend a little more effort to secure financing.
Plus, there are the new rules for resale owners that will go into effect on 21 Mar 2011. Any resale contract submitted to Disney for ROFR by the end of business on 20 Mar and is subsequently approved will be granted all rights of ownership as currently ascribed. However, after that date, resale owners lose the ability to use their points for certain Disney hotels and for Disney cruises (there are many threads that will tell you using your points for such things is a waste of money, but that's a whole other discussion). However, other than that, the use rules will remain the same for both resale and direct buy owners.
There is a wealth of info out there for you, so get cracking!
Hope this helped you.
Keep asking questions, everyone on this board is very helpfu.
