I just wanted to chime in that the Disney Deluxe Villas (which are their DVC/timeshare rooms) are very nice (so nice we bought at Animal Kingdom

, but they are rather pricey when you are paying cash. But you probably don't need a 2 bedroom. A one bedroom sleeps 4 ( 2 in a King bed in the bedroom and 2 on a pull out couch in the living room). The studios (one room- like a normal hotel room) sleep 4 too, and include a "kitchenette" which is basically a wet bar (small sink, a mini fridge, toaster and microwave).
Example prices at Old Key West are approximately $315/night for a studio, $430/night for a 1 bedroom or $630/night for a 2 bedroom at full rack rate for regular season (which Oct is considered). These are big rooms and it is a nice setting, but like I said, PRICEY.
The All Star Music suites rack rate on the disney site comes in at $220/night in Oct, if there is availability on your dates (there are a limited number of suites). I think the Values are fun for kids and I don't mind staying at them, although my husband does not enjoy them. He prefers to have a balcony and a "view" from our room.
The cabins at Ft Wilderness list at $299/night in Oct. I have always wanted to stay there, it just seems fun.
Staying off site would be cheaper and there is nothing wrong with staying off site, but we just can't bring ourselves to do it. Heck, we don't even rent a car, just take Magical Express & use Disney transportation to get around. It is nice to get up early, go to a park, come back and relax, swim or whatever in the afternoon and then go back to a park in the evening for awhile, this is much easier if you stay on site (or stay very near--like the Downtown Disney Hotels and get a rental car)
If you get the dining plan, then you won't need a kitchen, right? If you plan to be in the parks most of the time, then a value resort would be perfect...save your money-especially if you just need a room to sleep in and a pool in which to cool off.
If you want to lounge around a bit more or spend a lot of time at the hotel (as opposed to being in the parks all day) you might want to consider a moderate or deluxe. And don't forget about the Swan/Dolphin either. I have never stayed there, but it looks beautiful on their website.
Whatever you do it will be fun...it is Disney World afterall.