The 3-Day parkhopper allows you into both parks and to all of the rides for all three days. This also includes shows and other attractions.
Of course, meals and souveniers are not included and from my experience, this can get VERY costly. There are ways to cut this down, which from some research on this board, you could learn (buy souveniers from home and give to kids at DL, buy kids meals and share, etc.).
Hope this helps! Have fun!