We've stayed at both HIFS and a Tropical Palms 2 bdr cottage with our family. I would absolutely pick Tropical Palms. HIFS has a bigger, fancier pool, but that may not be that much of an issue in Feb. anyway. HIFS does also have the free breakfast buffet, which is convenient, but the cost of the hotel is higher so no real cost savings there. TP does have a little poolside cafe with cheap-o breakfasts (scrambled eggs, bacon, etc.). Food is not that great, but it's cheap and fast. On the other hand, we only ate breakfast there one time (using the "free bkfst" coupon we got at check in) because our cottage had a full kitchen and it was so convenient just to "eat in" each morning while we were all taking turns using the bathroom, getting dressed, etc. HIFS does have a SMALL kitchenette area (mini-fridge, microwave, bar-size sink) and a tiny table w/2 chairs, but at TP you get a full-sized dinette table w/ 4 chairs, FULL sized fridge/freezer, FULL sized stove w/ burners and oven, microwave, and best of all, A DISHWASHER! Plus you have dishes, pots, pans, silverware, etc. so you can cook full meals if you wish. At HIFS, the best you can do is nuke some leftover pizza, maybe some instant oatmeal, etc., but you'll have to bring your own paper plates and plastic forks. So for cooking/eating, TP wins hands down.
As for sleeping arrangements, both would be fine for your family size. The kids room at the HIFS only has a cloth curtain for a door though, so would not keep out noise from TV or conversation in the living room area. TP has regular doors on the bedrooms. TP also has a neat sleeping loft above the living room area that your kids would probably enjoy, but it is open to the living room.
Bathrooms at both places are small, but both do have a tub/shower combo. Probably more storage/shelf space at HIFS bathroom.
TP cottages have a deck w/ picnic table and it's nice to sit out there in the morning having your coffee or in the evening with a beverage or two.

More privacy than HIFS, which is your standard hotel style (rooms share walls w/ other people's rooms).
Both are a VERY short drive to WDW (5 - 10 minutes tops)
TP is also right next to Old Town, which has lots of shopping and attractions (I've never gone there, but heard it's fun if you have the time).
HIFS was fine, my family and I just enjoyed TP alot more. Any other questions, I'll be glad to try to answer!
Sue