We are frugal in some area's and not in others.
We like to go to WDW for approx 2 weeks per trip. In order to be able to afford this we do certain things to minimize costs. There are some area's we choose not to be frugal.
In order to save money we drive down, stay at a value resort and try to get a overflow rate from Shades of Green, we buy our tickets at Shades of green so we get the military discount, we buy a Disney Dining Experience card (timing it so we get 2 years worth out of it) to save 20 % on meals, and buy a regular Annual pass since (timing it so we get 2 years worth out of it) since we go for 2 weeks at a time.
For meals, saving the 20% (DDE card) or 10% (Annual Pass) is a real savings. We bring water, soda, snacks and breakfast items for use in the room. For us, its so easy to eat breakfast in the room as we get ready in the morning. What we won't compromise is our lunch and dinners. We mostly do 2 sit down (lunch & Dinner's) a day. Most morning in the parks we get smoothies.
The kids each get one large item that we buy. We buy a pen & autograph book for each of them. We usually will buy a t-shirt or sweatshirt for them as well. They must save and bring the rest of their own spending money. We usually buy one Snow Globe and we have over the years bought a few pictures in AK (along with a few other AK items) that have become the focus of decorating our family room & Kitchen.
We save money all year long in the form of change & an envelope that we use for spending money when we are down in Disney. There is always 300-500 dollars in it by the time we go. This is enough for our fun discretionary money in Disney. We use this for snacks, souvenirs, etc.
So for us, we don't scimp on food (except we save on breakfast and in-room snacks). We save on our hotel, because for us the value's offer such a great deal because of the theming and price. We use annual passes and the DDE to save so we can afford to go each year and stay for 2 weeks each time. I think everyone has different things they sacrafice in order to enjoy their vacation. For some the hotel is something they won't sacrafice, but they might decide a week is enough. For others they eat very inexpensively in the parks or stay offsite. That's what makes WDW so wonderful. There are so many options and way's to vacation that almost every budget can find something.