OFF-site due to our last trip 2 weeks ago when we stayed at the Vistana. No comparison. No amount of "magic" is worth being cooped up with my six kids in two over-priced hotel rooms where I have to buy every meal for at least 50% more than I would just outside the gate.....
I took my kids on the boatride from DTD to see Dixie Landings (called something else now)....because that is my favorite onsite resort. They weren't very impressed. The main pool was closed (I've never seen it open), and they thought the walk for most rooms was ridiculous to get to the buses/food court. (I agreed.)
They were into their own bedrooms, 3 tv's, our own kitchen, the pull-out couch, the jacuzzi, lots of pools, activities, and never complained once about the 10 minute drive to any of the parks. In fact, it was MARVELOUS for me not to rush around to catch a bus that ended up too crowded, very late, or just leaving as we rounded the building....not to mention folding and unfolding our stroller constantly.
For our family, staying onsite would cost a small fortune, (er, a LARGE fortune) and the amount of 'magic' just isn't worth that for us. We stayed at Vistana for 7 nights ( bought six got one FREE!) for less $$ per night than one room at a Moderate Disney resort.
I'd only recommend staying onsite for folks who are taking thier first trip to Disney and have money to burn. And I'd only stay at a moderate or deluxe resort.