I think you really need to look at all of the numbers when you make your decision. My husband and I tend to be fairly frugal with our
DVC points because we like to make them go as far as possible.
It really has never seemed to us like using DVC points for a cruise vacation was a great use of our points. We have never cruised before but just booked a cruise for Jan 2003 so this has been a subject of debate for us. I will spare you the gorey details of our long, drawn out decision but we essentially ended up with a 7 day cruise in early January for $3000. The cost for points for this cruise is 382 for two people. For the same 382 points, we could have an entire MONTH in a studio at the BWV in January. That's pretty much what swayed us.
I think there are two possible ways of looking at DVC points and you pretty much need to decide which camp you fall into. I think both camps are valid ways of using the program and I think at various times in our life we will fall into one camp or the other, so I'm not trying to make a judgement here.
One kind is the person treats their DVC like THE vacation budget rather than one component of the vacation budget. If they are going to travel, they are going to do it with DVC points. They already spent the money on DVC and aren't going to go through the hassle of nickle and diming themselves on every point and they take their one vacation per year (or whatever it is) and use DVC to do it, whether it is a week at WDW, a week somewhere else or a 4 day cruise. My friends bought into DVC for this reason.
The other kind (and the one we are in right now) is that DVC points are the WDW vacation budget. We try to use them as frugally as possible and get the most WDW vacation we can. Although we don't have a month's vacation to use those 382 points the cruise would've cost on, this past year we spent 12 nights in January, 6 nights in March and are spending antoher 7 nights in August. Even assuming we could get AP rates in January and August (not during spring break though), that would've cost almost $6000 for equivalent rooms for those 3 trips! To me that's really maximizing use of our points.
If this is your only trip of the year and it doesn't involve borrowing points to do either, I would do the thing that cost me the smallest cash outlay. But if using those points means not having a trip later, or having to pay cash for accomodations later, you might as well use the points for the thing you get the best value on for your money, ESPECIALLY those weekday DVC nights.
Sorry to be so long winded but if you could've been a fly on the wall of the discussion we had about our cruise you would realize that this is the short version!
PS, about the crowds in July... I can't answer that question, but the cruise leaving on the 11th of July costs about $300 less than the cruise leaving the 4th of July!
Lisa