I have stayed at Paradise Pier. I haven't stayed at Candy Cane Inn, but I did stay at a place a little further down Harbor Blvd, so I feel like I could judge the walking distance. Walking distance from both hotels is very reasonable, it will take you about 10 minutes. The other hotels along Harbor Blvd. within walking distance of the parks are good options as well. What I choose depends on which place has the best deal at the time. Some of them have fridges and microwaves, some have continental breakfast, some have free parking. What you would like depends a great deal on what is important to you.
As for whether it is "worth it" to stay on Disney property, you will get many differing opinions about that. It's not as worth it as it is at WDW, meaning there are less perks for staying on-site, and less variety of options at different price points. I enjoyed my stay at Paradise Pier, primarily because it had a great view of the parks, but would I pay to stay again? Certainly not full price, only if I was able to get another good deal on it. The same goes for the other on-site hotels as well. They would be awesome if I had money to throw away, but I use the hotel mostly just for sleeping, so there's really no point to paying more than I need to.