Hi E.,
I have been to Disney World often (have season passes). We LOVE Disney. Christmas time is the BUSIEST time of the year there. I don't know if you're planning to actually go Christmas week or ? We went once Christmas week and it was so crowded that it felt like you couldn't move. Lines for rides were over an hour long.
It's beautifully decorated and the parades and activities are fun, but please know the crowds will be worse than in the summer. Please go see the gingerbread houses at the Grand Floridian. They are absolutely stunning. Not to be missed!
We have stayed on property as well as at houses nearby. Disney traditionally runs some great deals around Christmas. My friends went last year the second week of December and received the dining plan free (which is a substantial savings). I rented a house for my family and our pen pals from England who came in November for 8 days and it was around $1,000. You can find very reasonable rentals through www.vacationrentals.com Most properties will haggle with you on the price of their rental so don't be afraid to email them and say I can pay X instead or can you throw in pool heat for free.
If you want to PM me, please feel free to. I've been to Disney very, very often. I've been all times of the year as well. It's still my favorite place to take my family.
Have fun!
L.