I've seen the show several times over the past 10 years. You can read about the "plot" of the show or what characters you'll see on wikipedia if you're interested or think you need to prepare young children.
http://en.wikipedia.org/wiki/Fantasmic!
I brought my DS8 to the early show (8:30 p.m) of Fantasmic! this week. I brought his video game to keep him busy while we waited for the show to start but of course it wasn't charged so that wasn't helpful. People were already lined up waiting to get in at 6:45 p.m. The seating area opens at 7:00 p.m. for the 8:30 p.m. show. I like sitting in the front row so I don't mind going early (but I also live 10 miles from the parks so I'm not in any great rush to squeeze everything in on my visit.) We bought some snacks

and just relaxed and watched the stadium fill up -- by the time the show started, the stadium was completely full.
If you have a rental stroller, you'll be asked to remove all personal items before parking the stroller.
You're seated one section at a time, so if you don't like where you're being asked to sit, just wait for the next section to be seated. You can buy snacks like pretzels, cotton candy, drinks, beer from both the refreshment stands and also vendors walking around. There's also a lot of light up toys that are very popular. It was cold night and the blankets were a big seller. The first 4-5 rows can get wet from the water fountain spray during the show so sit farther back if you don't want to get wet (you don't get soaked like Sea World's Shamu show.) There's also fire used in the show and you can feel the heat so if it's a really hot night, you might want to sit further back.
If you are meeting up with people in your group and have cell phones, you can let them know to meet you at a certain character's flag (mickey mouse is center seating for example.) Each section of the seating has it's own flag -- be sure to look at this when you leave your section for refreshments or restrooms.
There are restrooms located at the top of the hill in the stadium.
There is a fun pre-show about 1/2 hour before the show starts -- two cast members did audience interaction with songs, trivia games, and music.
There's a direct path exit to the front of the path so ask or look for that if you want to leave the park directly after the show ends.
Be aware that the show can be cancelled if there's inclement weather.
It seemed like most of the people that had the dining plan used general seating because the reserved seating area never looked that full. It's probably because the reserved dining plan seating area is at the very top of the stadium.
Enjoy the show!