We have been down to WDW during the first week of February for the past two years, and I must say we love it. We have not found the weather to be bad at all. The first year we went we definitely did need a light jacket in the morning, but by late morning they were off. We saw people in shorts and tank tops. Pool time was bit tricky - you really had to time it right to be in the warmest time of day - the 2:00 to 5:00 range, which worked great for us but I know wouldn't work for everyone.
This past year it was downright hot! In the mid to upper 80's almost the whole week. My sister and I were both sweating by 10:00 a.m., and the whole family went to the pool every day. In fact, I would have preferred it to be much cooler.
Since I have never been to WDW at any other time of year, I can't speak to the crowd levels comparitively, but I can tell you that we thought the crowds were quite manageable, especially in the morning hours.
We are planning on doing WDW again in February of '09, and you couldn't pay me to go during peak season. Too hot and too crowded.