Here is how I would consider the issue:
You have, free, the Counter Service Dining Plan which provides you two counter service complete meals including entree, drink, and dessert per day. In addition, you get two snacks per day plus a refillable resort mug.
The "value" of the counter service meal runs around an average of $14 per Lunch or Dinner. There are places where you can get get more "value" or less, but 14 seems to be a good average of eating around the world. If you grab a meal with a drink and dessert. If you drink water and don't want a dessert, the "value" is much less.
If you use your Counter Service Credit for Breakfast it is worth, on average, about $10 since there is no dessert nor an extra juice option to add.
The snacks have a value of $3.50 average. Some snacks are more, some less, but $3.50 is relatively representative.
The mug runs right at $15.
By upgrading to the regular
DDP, you will lose eight counter service meals, eight snacks, and the mug. All of things together have a "value" of $155 lost. In addition, you will have to pay 104 per person to upgrade. So, the change has a "cost" of $259 to be able to add Eight Table Service Credits if you would have used the counter service credits for dinner or lunch.
If you use all 8 of those credits at the Signature restaurants which require 2TS credits per meal, you will be have "spent" $64.75 per meal.
Keep in mind that if you eat at these signature restaurants on the regular dining plan, you will be able to get an entree, dessert, and non-alcoholic meal and the tax covered.
You mentioned eating at California Grill. Were you to eat there and order the most expensive entree, the filet at $44, the most expensive dessert of chocolate cake at 13, and a soda at $3, your total bill, with tax comes to $63.90.
As such, you would be losing money to upgrade to the regular DDP and then use it for a dinner at California Grill.
Now, were you to use those eight credits at the nicer one table service credit restaurants, you could "come out ahead" as each meal would only have cost you $32.38. Restaurants you might want to consider include Yak and Yeti, Mama Melrose Fantasmic Dinner Package, Coral Reef, Akershus, Le Cellier for Lunch, Tutto Italia, Boma, Sanaa, The Wave, The Grand Floridian Cafe, and Kona Cafe.
If I were in your shoes I would either Keep the free Counter Service dining plan and add in a few of the 2TS credit restaurants out of pocket, or I would add the regular dining plan but book 1TS credit restaurants.
Keep in mind that if you keep the counter service dining plan, you could eat at several very nice restaurants, out of pocket, which are not included in the DDP. Il Mulino, Bistro de Paris, Bluezoo, and Wolfgang Puck's Dining Room.
At Bistro de Paris, for example, you can get a Three Course Meal for only $54 without wine.
Yet, the value of the counter service meals is only realized if you will actually enjoy eating at the counter service restaurants. Here is the list of our favorites:
Gasparilla Grill at Grand Floridian
Cook's at Poly
Wolfgang Puck's Express at Downtown Disney
Tangerine Cafe in Morocco at Epcot
Sunshine Seasons in the land at Epcot
Columbia Harbor House in Magic Kingdom
Yakatori House in Japan at Epcot
Main Street Bakery in Magic Kingdom
Starring Rolls Cafe in DHS
Flametree BBQ at Animal Kingdom
Yak and Yeti counter service at Animal Kingdom
Roaring Forks at Wilderness Lodge
Mara at Animal Kingdom Lodge
Pizza Planet at DHS
Kringla in Norway at Epcot
If your family would really love to do the 2TS credit restaurants each night, then you could come out ahead if you added an additional $44 per night to add the Deluxe Dining Plan, which would let you have three credits per day per person. You would keep the two snacks and refillable mug per person.
For our family, we have done the Counter Service plan, either free or OOP, and then paid for 3-4 nice meals out of pocket. Many things we enjoy are just not on the regular plan. The Wishes Dessert Party and the places like Bluezoo are really wonderful and I hate to miss them because we are tied to the dining plan.
We have also upgraded the free Counter Service PLan, but only if we keep our table service restaurants to the one TS places.