Ok put your MIL in the bed next to the bathroom. You and DH take the bed next to the window (better view). Put the pack and play between your bed and the window nearer the foot of the bed. I would put the table that is in front of the daybed (size of a twin bed when folded out) next to the bed by the head of he bed. You can use to dress, change the baby just put a few towels on it for comfort. Yes it can be done. The bathroom is 2 rooms with an inner room toilet, and outer room 2 sinks and bath/shower.
I stayed there with DH, 2 DD's 16, DS6 and myself and there was plenty of room even with the daybed out. It is also very easy to put back into place for more room. Alas I had no balcony as I was on the 2nd floor over looking the monorail. You could ask for a ground floor then when the kids sleep the adults could sit on the patio and enjoy the evening. I actually liked the garden rooms. I have never stayed in the main building but when we passed through it seemed loud to me. I always wondered how quiet the rooms could be if the inside was so loud. ie Chef Mickeys OUCH my ears. But love to go.
I do agree with you DH the Monorail being right there with the 2 kids would be great. But dont discount the WL it is only a boatride away. I stayed there in both the WL and rented point to stay in WLV. Even my DH had to admit it had easy access to the parks as we used the boat to the monorail for Epcot. or the busses to MGM/AK. As a matter of fact you may want to take a look at the DVC board and price out a DVC studio for your trip. It saved me a few $$ over my postcard price for the room at WL. Post card price was $124 plus tax 11%-- DVC studio with kitchenette was $130 Sun-Thurs. And it gave us a taste of the DVC life.
Both have a marina. Both have boat access to MK. Easier access to Chef Mickeys. A short walk back from MK if you dont want to wait for the Monorail at the end of the day. The water parade in the evening if you make it an early night. Then go to the end of the pier and watch Wishes in the sky over on the right of the hotel. The pool seems to be open longer in the evening at CR than the other hotels we stayed at so if you want a quiet room try for the bay side as opposed to the pool side. I was lucky to not get the pool side. It can be noisy until the wee hours of the am. Your DD will love the slide into the pool. Dont forget to get her a life jacket at the marina its free with your room key and you just have to turn it back in when you leave the resort. I kept mine for the entire stay, then when we got back and the marina was closed my DS could still swim in it. PS they do go under when going down the slide. My DS loves to swim under water. Yours may not.