We have been going to WDW the week of July 4th for many years, and we love to go during that time. Yes, it can get crowded, but we avoid MK and stick to Epcot on the 4th.
This year the 4th was on a Thursday, and many companies gave people that Friday off, making it a long weekend. I thought the crowds this year were less than last year, but I think that was due to 9/11. Next year, the 4th falls on a Friday, so actually it will be a shorter weekend than this year.
We find that the parks are open a little later during this time, and certain attractions that are closed at other times (COP, and Timekeeper) are open for this holiday week.
Yes, it is hot, but I have to tell you that it was cooler in WDW (85)the week we were there than back home in NJ (98). As a matter of fact, this whole past 10 days has been cooler in FL than in NJ. NJ's summers stink, so the heat/humidity in Florida doesn't phase us that much.
Generally, we think it is a very festive time to visit WDW. Also, because we won't pull the DD's out of school, and I also work in the school system, and my DH gets limited vacation days, this works out to be the best time for us to visit.