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Re: Which Disney Resort?
I have to say this, so bear with me. I don't honestly think the dining plan is always a good financial move. If you are paying rack rate for the hotel, then you really aren't saving anything.
I personally believe that the most cost effective AND most comfortable WDW stay can be to rent an offsite villa along with transport. We are DVC members so that is part of the reason I say that. Granted, DVC is on property, but if we didn't have that, we'd be going for an offiste villa (which we did for our first visit; not a villa proper but a full guest suite (living room, kitchen, bedroom)).
If you want to stay on property, then definitely look into the value resorts as they are very nice. :yes: You can ask for rooms that are connecting too, if that might help with the kids and the grandparents.
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Which Disney Resort?
If you want more space then I would stay offsite and get a villa. You'll have so much more room.
If you want to stay on Disney property you will really need 2 rooms with that many people. Yes there are family suites at All Star Music and Art of Animation but I don't think they are suitable for that many adults.
The dining plan can be a good option for some but not always.
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Re: Which Disney Resort?
The dinning plan takes some serious planning IMO to get the most out of it. If this is your first time at WDW then I recommend not doing the dinning plan.
As far as where to stay, if you all want to stay together then I recommend a 2 bedroom at a DVC resort (pricey) or an offsite villa. You could always try adjoining rooms at any WDW resort but then you are doubling your budget for a room and then that also all you're getting is a room. No kitchen, no in room laundry, etc.