Wow! I was just talking last night about doing an extended family trip to Disney and we'll take care of the rooms with our points. Now I'm second guessing that - glad I didn't mention it to any one other than my husband . . . really need to think through how to impress upon them the importance of committing to doing the trip.
Another hint....in your case find out if the extended family wants to vacation together AT ALL, before mentioning that you were thinking of providing rooms. FREE often gets in the way of thought in these things, and if you start talking with your family about vacationing together without mentioning WDW or your timeshare, you may discover they have very different ideas.
My family had a disastrous non-trip because we all had different ideas of what to do, different ideas of the budget, and different ideas of when it would be possible to go. A "free" timeshare wouldn't really have helped the basic issues (and didn't as my flaky sister ended up saying "WDW, I don't think so" - but did have some good reasons - she didn't have a lot of money at the time, had started a new job so vacation time would have been an issue - but really, she wasn't that into the Disney World thing to start with).