A few years ago, I would have answered this question with, "why NOT stay on site?!"
However, after many, many stays at the Disney "deluxe" resorts, we finally gave up on trying to justify the cost. For our family of four, a small room with only two queen sized beds and a cramped bathroom just didn't work well. For what we payed at the Wilderness Lodge and Polynesian, we could have rented TWO four bedroom houses minutes from gates of WDW.
I understand that some people only go to Disney once in a great while, and in that case, then yes, I think it is worth staying on site. If you are pinching pennies and clipping coupons to make your vacation work, however, I am of the belief that you can be FAR more comfortable and get FAR more for your money off site.
Along with the astronomical (and ever increasing) price of staying at a Disney owned and operated resort, the lack of all around value (dining, shopping, etc.,) and the severely over stated "deluxe" amenities, the lack of a frequent guest program really puts me off. For the number of nights and price point of the rooms we stay have stayed in at Disney, we would easily be the highest level of rewards program at any other major hotel corporation.
Enough with my ramblings...