I agree with majority to keep your plans simple and flexible as possible. The trouble with many options at WDW is that they = time constraints. How long it takes to GET to the meal at the SPECIFIC time you are required to be there is the problem. Instead of BBB, our extended family prefers bringing costumes, but ONLY AT the character meal (w/sneakers + outfit under it). Just as much fun for the 4 year old, but much easier!!!! Actually being one of few kids NOT in a costume at princess meals can be hard. Costume can be simple hair clips, themed shirt, or costume gloves. One or two character meals all week is plenty.
A few dollar store trinkets are fun, but simple = good. Autograph books help with learning letters! A great travel toy is a Doodle-Pro board: low $, and so many uses: numbers, drawings, + reminders.
Another fun for a child is drawing tip envelopes in the hotel. If you are staying onsite at either WDW or US, and even some offsite...strategically leaving a few small dolls/ figures or stuffed animals on the bed often =housekeeping fun. (simple but fun)
Kids in our extended family didn't NEED afternoon breaks every day (except summer), but sometimes napped in stroller or room. LIGHT+ easy fold were key in stroller + a junk basket and rain cover (a $.99cent poncho can work) Also MARK stroller: stickers, or Knotted ribbon. CM's always move strollers.
Agree, WDW can=over stimulation. not just kids, but also adults. This is another reason to keep expectations +plans simple. I've seen too many sad families over the years because a PARENT is having a meltdown! ("I paid for this, and YOU WILL enjoy it!")
Giving simple choice (food, rides, clothes) is super. Encouraging children to face fears = good, forcing them on rides they hate/eat foods they hate = bad. Fine line between the two. Also, WDW= the very best marketing in the world. I suggest making small allowances here and there.
But by far the best way to enjoy WDW with small kids is to allow them time to discover. Giving them a (free) paper map can be great! DO explore water fountains, gardens, resorts. Do pick up a free kidcot bear in the World Showcase and get it stamped in each country. CM's will also write names in different languages or draw little flags. (though we always said, "We'll color it later.") Another fun free option is asking a CM in each country how to say something like please and thank you. It isn't just the WS either. WDW has multi-lingual CM's in over WDW and hotels. The only parade we ever see is the night parade in MK, and if we happen to be in a spot to see it, the water parade on the MK lagoon. both have amazing lights.