I went thru the same thing while planning our vacation to Universal. I really wanted to stay onsite for FOTLA & the convenience. I just knew my teenagers would love the Hard Rock Hotel. However, the cost was just too prohibitive. My budget was soaring.
As a result I ended up arranging, rearranging & finally confirming my Universal vacation. First, we went off season, which other posters have suggested. We went in September. The lines were short. Second, we got there early in the morning on a weekday. We were parked, in line & ready to go before 9am. I've noticed that lines get longer during the day. Third, we purchased season passes. That way we could go from one park to the other on the same day. We have blackout dates, but I don't ever go during peak season anyway. Finally, we decided to rent a house. We have teenagers & this worked out great for us. By the afternoon, they were done with the parks. We'd go home & they'd swim, play pool, or watch their DVDs. Going off season, we had a big selection of homes. We ended up paying $100 per night for a 4bdr, 2bath home with a swimming pool & game room in the garage. That was cheaper that a regular hotel room at the Hard Rock. I also worried less about my sons because they were either in the house or in the pool. At the hotel, I would have worried because they would have been exploring everything; they would have been all over the place. Even though I didn't do the dream vacation I thought I wanted, we had a great time. We didn't have any problems with lines, we rode every attraction we wanted to ride & we had a great time.