Lots of people are having good luck with Priceline.com. Some are getting the Dolphin hotel - on site - for $67.00 per night. Some people are also getting off site hotels for that price or better. Good Luck!
We will be a party of 6 when we go in May and we booked a GREAT rate for a 3-bedroom suite at Doubletree Villas, Maingate through Dreams Unlimited. They also have 2 bedroom villas too. We always like plenty of room to spread out and since we spend such little time in the hotel we didn't need anything too deluxe.
We got a great rate at closesttodisney.com for a 3 bedroom condo. We will be a family of five and it was cheaper per night than 1 night at the allstars w/ a disney discount.
I just received Hotel Royal Plaza on priceline for $40. There is no guarantee that this is the hotel you would receive if you bid for it. The brochure I requested from them state that the room can accomodate 5 ppl. 2 beds and a sofa bed.
I know the occupancy limi8t on the typical Disney hotel room, is 4.....but my friend always squeezes her family of 6 into one. Sounds uncomfortable....but the twins (age 5) absolutely love their "slumber party" onthe inflatable mattress they bring along.
I don't think I'd try Priceline with 5. The official occupancy for rooms booked through Priceline is only 2. It's possible you could be given a room with only 1 bed and not have any reason to complain. It's usually not a problem to have more than 2 in the Orlando area, but why take a chance when there are so many other options?
There are a lot of condos around that are just as inexpensive as hotel rooms. http://www.closesttodisney.com/ has been used by people around here (as the above poster said )
We used skyauction for our Honeymoon last June. I think the final price was $225 for 7 nights at the Silver lake resort. The room was amazing (2 bedroom suite). It was only the two of us but there was enough room for about 6-8 people. Amazing deal! It is located just outside of the animal kingdom.