We just got back from Disney a few weeks ago. We did not use the Disney Dining Plan, and we were glad we didn't. We didn't spend anything close to the amount of money of food that the Dining Plan would have cost. Our kids are 5 and 2 and by the time we were in the parks all day everyone was too cranky and zonked to enjoy (parents) or behave at (kids) a nicer sit-down place for dinner. Although we had planned several reservations at sit-down places for dinner, after the first one, we ended up canceling the rest. We for the most part did counter-service meals. For lunch, we found that we didn't want to lose the time we could be going on rides to sit down at a table service restaurant.
We were fine with having a big breakfast, grabbing some snacks throughout the day, and having a decent dinner every night. We too had a kitchenette in our hotel room at a Disney resort, but we didn't bring or make anything in it the whole time we were there (except coffee and using the refrigerator to keep some drinks cold). I might use the kitchen more if we go back, because we found it challenging to find things aside from double cheeseburgers and chicken fingers in the parks. They do have lots of fresh fruit stands, which is great, but sometimes we were just looking for something simple like a ham sandwich and they were nowhere to be found.
We did do a character breakfast at Hollywood Studios, and honestly, the one "nice" place we went to, Citricos at the Grand Floridian, I didn't think was all that great menu-wise or atmosphere-wise. The only great thing about Citricos was that we could see the Magic Kingdom fireworks from our table.
I know a lot of people like the Disney Dining Plan, I think mostly for knowing that everything's paid for before you go. I saw a lot of people struggling with the DDP at the cashier stations trying to figure out what's a snack, what's a meal, etc. etc. I can't say for sure, because I didn't use it, but it looks all the people in your party's meal plans are on a separate card...so if the dad or whatever would go get the food and bring it back, everything would hit against his snacks/dinners/etc. and then everything gets kind of uneven and confusing and then it gets confusing about how many meals are left, what to charge to whose card, etc.. That's the sense I got from standing in line behind people with the Disney Dining Plan. I can't judge too much because I haven't used it myself though. I think it's probably great for people who have older kids along who can go off on their own in the parks for part of the day.
Also, another option is, since you're staying in a Disney resort, your room key is your park ticket and you can charge almost everything back to your room if you want to (food and/or souvenirs), and check it at the end of each day to make sure you're staying in budget. That prevents you from having to carry a bunch of cash or your credit cards around.
Sorry so long...just my two cents. What works best is different for every family. Just for some perspective--we stayed for 6 days and 5 nights and spent a total of about $1,600 (apart from the hotel and flight and park tickets) while we there for food, drinks, souvenirs, entertainment extras, etc., for 2 adults and 2 kids.
Hope you have a great time!!! We had a blast!