I have only been to the World for two August trips in recent history. In 2008 we were there from the 13th through the 19th. In 2009, we were there from the 24th through Sept 4th. Because of my relatively small sampling, I don't know if my observations are a good general rule or not, but I'll share them with you anyway.
When we were there in 2008, it seemed quite busy. It was the week before the Free Dining started. The parks were pretty crowded, the big rides had long lines fairly early, and the parks had quite long hours, including two showings of Fantasmic on many nights, two showings of Spectro Magic the first couple of nights (after that, the stopped showing it due to the bridge construction in MK), and EMH hours until 3:00 AM at MK.
In 2009, we were there at the end of August, and it didn't seem nearly as busy. We hardly waited more than 10 minutes for most rides (though we did use FP quite a bit on the headliners). Park hours were cut back quite a bit with early closings at AK, single showings of Fantasmic only three nights a week, and single showings of Spectro, again not every night. At MK, the evening EMH (remember it had been open until 3:00 AM the previous year) was ending at 12:00 PM, with regular park hours ending at 9:00.
I definitely felt there was a significant difference in crowd levels between the two trips. The restaurants did seem a bit busier in 2009, but we expected that being it was Free Dining.
I've read here on the DIS a few times that the first week of Free Dining tends to be very busy, then it slows down a bit. We were there during the second week of Free Dining last year, NOT the first, so that may make a difference. This year, we will be there during the first week of Free Dining, starting on August 15th. I'm kind of expecting the first week to be pretty busy, and the second week of our trip to be somewhat less busy.