You can actually enter the park anytime after 4:00. However, the actual party does not start until 7:00. From 4:00 - 6:00 you can enjoy the park and at 6:00 anyone without a wristband for the party will be asked to leave. Anyone with a wristband will be moved into one of the lands. I heard this year it is Adventureland. From 6:00 - 7:00 they set up the park for the party while everyone is in Adventureland.
If you come between 6:00 & 7:00 though, I don't know if they make you wait outside of the park until 7:00. Maybe someone else can advise on that.
Yes, it is always busier at the beginning of the party. It thins out as little ones start dropping off.
Have Fun!!