We love pets, and have several, but I would never want to see the current resorts become pet friendly DVC. Pets really increase the maintenance and housekeeping requirements for a space, and DVC seems to have trouble keeping up with both already. Furthermore, pets can get loud when they are unhappy. (Children can, too, of course, but children are very much a part of Disney, and everyone expects them to be around.)
I think converting part of an existing DVC resort would be a disaster. Too many people suffer from allergies, and maintenance costs are already high. At a minimum, they would have to convert only a small portion of rooms to pet friendly, and those would have to be a separate booking category, not a request. Obviously, guests would have to know in advance, as they would have the pet with them, and some guests would need to not book those rooms because of allergies. It sounds like a horrible idea to me.
I think building a new DVC pet friendly resort would be the only good option, if they chose to go that way. I still don't think it is a good idea, but better than transforming part of an existing one. It could be furnished with designs made of sturdy materials in a distressed style that wouldn't show wear as easily. It could have special dog park areas, possibly one for big dogs and one for small dogs, and areas for walks. Owners would purchase knowing that maintenance and housekeeping would make for higher dues, but there might be enough people interested in such a thing as to make it desirable.