Mooneybeams,
I, too am sorry that you stay was not all you'd hoped for. Like the other posters, I am also in agreement that your expectations may have been a little too high, except for the soiled sidewalks.
Now, as for the gay comment, I would really, really like to know in what context it was made. As another poster stated, unless she was describing sex acts, I don't think it was offensive. My seven year old knows all about drugs (through the D.A.R.E. program), all about kidnappings (through the "stranger danger" and Sgt. McGruff programs and the media), and some about domestic violence (via kids in her class). Yes, she has asked us what "gay" means and we answered, "Sometimes girls fall in love with girls or boys fall in love with boys." She said, "Oh, well I think I'll fall in love with boys, " and that was the end of it. It was a heck of a lot easier conversation than the one we had about why Jimmy was covered with burns and couldn't live with his mom anymore.
I do realize that you wanted to broach the topic of homosexuality with your daughter, but in today's society I think kids are exposed to all kinds of things before we (as parents) think they are ready.
I hope you don't give up on WDW. You may have a better time staying offsite and just hitting the parks next time. Again, I am sorry your vacation wasn't as magical as you had hoped.