It is all relative depending on where you are from. We have been in July several times (pre-2020). We have found the weather to be fantastic. Beautiful in the mornings and evenings and sometimes a little hot in the afternoon. It has always been cooler than it is at home, and nothing like being at WDW between June and September. We heard locals complaining about the heat- but to us the weather was really nice.
We have found the crowds manageable in July. Surprisingly the weekends have had lower crowds than weekdays- which was probably due to AP blackouts. We always used FP/Max Pass and actually really enjoyed going in July. Of course, everything is different now. We went in October this year and it was way more crowded than what we were used to pre-covid July. Without Max pass or FP we got way less done than we usually do in July.
Most years we spent half the week in DLR and half the week in the San Diego area (one year we went north to Universal/LA instead). It is a good split. We love the San Diego area. I would not recommend staying in San Diego and driving to DLR every day. I would stay near DLR for part of the week and then move down to San Diego (or start at SD and then move up to DLR). With you being used to deluxe in the WDW bubble, I would stay on property at DLR if possible. We typically like the
Disneyland Hotel. We have stayed off property for part of of trip once and being used to the WDW bubble for years, decided we prefer the DLR bubble as well.