This is true for the Fantasmic! dining packages, but I think the OP was talking about WOC. All sections must stand for WOC. The reserved dining package sections differ by which restaurant you dined at. I believe Carthay Circle is supposed to have the best section. Last time I saw WOC I did an Ariel's Grotto dining package and I think we were in the same section, or at least right next to, the Wine Country Trattoria folks.
As for whether the sections are actually better viewing, that is more subjective. The thing is, no matter which section you are in, if you are standing behind a certain number of people you aren't going to get a great view. I think it's more accurate to say that the dining packages offer the possibility of better viewing. If you arrive early, when they are first opening the section, you can get a really great spot. You will likely have access to the "wet zone," in the very front along the water. I personally don't prefer getting that wet, so I like to be one tier back, against the railing that looks down over the wet zone area. My sister and I got there about an hour before the show and had an awesome view. So the dining package was certainly worth it for me. However, it didn't take too long for the railing spots to fill up, and we soon saw others arriving later that were quite displeased with their view, as their children had to stand behind other people and couldn't properly see the show.
So basically...whether you go with the dining package or not, arrive early. If you get a regular FP, you will be jostling for position with more people and will likely need to get in line earlier. If you go with the dining package, you will still need to arrive early but your line/section won't be as crowded.
