There are not as many perks to staying on-site at DLR. The only real substantial perk is that you get access to EMH (Extra Magic Hour), where you get to enter one of the parks (it rotates each day) an hour before it opens to the public. However, if you get a 3 day or more parkhopper ticket, you will get an early morning entry (called Magic Morning) for one day of your trip, only for Disneyland, available on certain days of the week. This is true even if you stay off site. You have to buy the tickets ahead of time, you don't get the Magic Morning if you buy in person at the ticket booth.
If you decide to stay off site, make sure to book directly with the hotel. There is no benefit at all to booking a "Good Neighbor Hotel" through Disney, as this label is meaningless and the prices won't be any cheaper. In fact, they may be more expensive. Often you can get better deals when booking directly with the hotel.
When choosing a hotel, location will be one of the most important factors, especially if you want to walk to the parks every day. The ones directly across the street from the crosswalk leading to the DLR entrance are going to be the closest. I stayed at Castle Inn recently, which is down the road further, and it was a little bit farther than I'd like to walk in the future, so I probably won't stay there again. But anything closer to that will be great for walking. When pricing out hotels to compare, keep in mind that some charge for parking, and some don't. Don't write off a hotel just because it charges for parking though, as after doing the math I've often had certain hotels come out cheaper even with the parking fees factored in.
Whether you stay on or off site, you can either purchase your Disney tickets directly from the Disney website, or you may find discounted options on some trusted third party sites, such as
Undercover Tourist. Ask around here before going with a third party seller, just to be sure it's legit.
And if you really want to stay on site, I think the Disneyland Hotel would be a great choice. Many feel that Paradise Pier isn't really worth the price, and I tend to agree. My stay there was good, and my favorite part was the great view of DCA, but I was staying there on a significant discount. I would have a very hard time justifying a stay for full price.