There is so much to do while you are there. You really should go to all the parks, I'm not sure of the kids ages. Magic Kingdom is the best place for younger kids because of rides. It is a lot fun. Most places will tell you when you get in the park to go left. Most people will go right, going this way will take you with the crowd and lines will be longer. So you will be in the reverse of everyone else. There are a lot of great character opportunities in the park, great pictures and the kids love it. I also highly recommend taking a camcorder. My parents had one for my first trip to Disney and it is priceless to me and my family now. It is the best way to keep the memory with you forever.
Try to see the fireworks and parades. The kids will be amazed. They are both beautiful. The kids may not be able to stay up for the fireworks, because they are before closing. Sometimes it is a good idea to take a break in mid day or so to get a quick nap in, it really helps. You could also go back to the park to catch the fireworks if they are unable to stay the whole day.
A few character meals would also be great for the kids. This allows them to interact a little more with the characters and spend a little more time with them rather than visiting them at a character meet where there is only time for a picture and autograph.
Two things you definately want to take advantage of is early entry days and fast pass. Early entry gets you in the park before other guests, if you are staying on property. This is for a different park each morning. Fast pass is something Disney offers to help with the time of waiting in line. You put your tickets in the fast pass machine and it will give you another ticket, one for each ticket. This will give you a time frame to come back when you will go in the fast pass line and not have to wait in the regular line. Saves a ton of time and definately worth doing.
If your kids hate waiting in lines, you may want to consider this as well. Sometimes parents will bring activities for the kids to do while in line. Something little that isn't hard to bring with you and will keep them occupied. This will make it nicer on you as well.
As I mentioned, Magic Kingdom is definately the best park for the little ones. Animal Kingdom is also really great for younger kids. There are a few rides that they will really like, as well as shows, plus they can see the animals, which is always a lot of fun. MGM and EPCOT also have some great rides, but these are usually for a little bit bigger rider, the rides are a little more rough than the other parks, but still great to visit.
Go online and do your research. Look at all the parks to get an idea of what you want to do. This will give you a good idea of which parks are best for your family, where you want to dine, etc. If you want actual books to take, Passporter and Birnbaums are great books to use. They have a ton of information and are really helpful.
I use this site http://mousetrips.com/ for all of my information and to book my trips. It is a good source of information for your trips.
Downtown Disney is also a great place to visit. There is a lot of shopping and some really good places to eat. This is where you will find the huge World of Disney store which has tons of things to purchase and always fun to stop in. They also have the Lego store, really great for the little ones, Once Upon a Toy, etc. Disney Quest and Cirque are also in Downtown Disney. I love Disney Quest, this is the indoor virtual reality theme park. Cirque is a really amazing show. I was just in disbelief every time I have seen it. Disney says to judge whether or not your kids will be able to sit through it, is to judge on a movie. If your kids can sit through a movie in the theater they should have a good time at the show. However, this is something a little older children and adults like more than kids. This is also a good night for just mom and dad. Have a nice dinner at one of the Downtown restaraunts, Wolfgang and Fultons are always a good choice, then go to the Cirque show afterwords. It's a good time to take advantage of Disney baby sitting and a good time for mom and dad to have time together.
If you haven't booked yet you really should do this as soon as possible. The big trips I plan to Disney are book about 6 months in advance. This will allow time for the most availability and most likliness I will get the resort, etc. I am wanting. I always stay on property, definately the best way to go. Free transportation to parks. Great prices on tickets, less expensive than getting them at the gate, huge savings. Also you can add on the dining plan. Another great way to save some money. It's also a good idea to book dining ahead of time. Otherwise you may have really long waits or not be able to get to the restaraunts you want to eat at.
Have a great time and enjoy the trip. Take lots of pictures!