Make sure that each person has at least one outfit in each bag. That way, if the airline "misplaces" a suitcase, everyone has some clothing!
I pack kid outfits in a ziplock type bag--complete with undies and socks. Easy to unpack because I slip the bags in a drawer. In the morning, hand a bag to each kid (or to DH and tell him to get kid ready.)
THis means that you don't hit the last day and realize that nothing matches any more...another plus.
When packing, we do one bag per person...but make sure to play "musical outfits" so that each case will have at least one outfit for each person. Having spent 4 days without luggage, I learned (it wasn't Disney's fault!)
This is almost exactly what I was going to say word for word. Absolutely do not designate a suit case as one person's and pack all of their stuff in it. if that was the one suitcase that was lost on the flight, that would be a real bummer.
What we usually do is set out all of our suitcases and then literally divide up each person's stuff fairly equally between the suitcases so that if one was lost, we'd still have a large amount of our stuff.
I am also a big ziploc bag fan. I put outfits in them when possible (summer travel, never had much luck with jeans and ziploc bags). I also always ziploc bag anything that could leak such as shampoo, conditioner, contact solution, etc. Sometimes I double ziploc it because as others mentioned, your luggage can take a real beating sometimes and I want to make sure not to ruin my own or other people's stuff with our liquids.
We always fly Southwest so we're allowed 2 checked bags each. I think we've used 2 each on every trip except our last one and we were able to fly with 3 for 2 people.
As far as buying luggage, I do not buy the sets as you end up with one big, one medium, and one small. I like to know that I can maximize our checked bags so I buy them separately so that each of us have 2 large 28" (I think) bags and then a carry-on.
I buy all of our luggage at discount/clearance. I think both mine and my oldest daughter's came from Burlington Coat Factory.
I also look for bright, maybe ugly, luggage so that it is easy to spot our luggage from a distance, and the chances of someone else using it or slim to none. When we had "standard" solid colored luggage, I bought fabric paint and we decorated our luggage to make it stand out.
We also buy crazy handkerchiefs and tie them on the handles really tight. Again, this is just to help us identify our luggage when it is on the luggage carousel in the airport or piled up at the terminal on the way back home.
I also learned that I am horrible at guessing the weight of our luggage so I bought a cheap luggage scale (at Target I think) and I weigh our luggage as we finish up to make sure nothing is over 45 pounds (I figure if I keep it at 45 or less, then even if the scale is off, I should be safe). I also pack the luggage scale for packing for the return flight.
Hope this helps.