Hi Alison:
This is a very good question. I'm a huge fan of deluxe Resorts, however, I would never recommend one if it would break the bank. There are eight Deluxe Resorts. I've found the biggest difference between Deluxe and non-Deluxe Resorts to be the size of the rooms and the grand theming of the Resort. The theming of the Deluxe Resorts extends not just to the room, but to the lobby and to the pools. Deluxe Resorts also tend to have more programs at the Resort., usually dedicated to kids. So unless you plan to spend a day dedicated to the Resort to take advantage of the benefits of the Resort, it may not always be worth it to stay at a deluxe. If you plan to spend most of your time at the Parks, or your trip is very short, a moderate or value may make more sense. Deluxe Resorts tend to be closer to a Park and, except for Animal Kingdom Lodge, have multiple transportation options aside from bus (like boat launch or monorail). They also tend to feature signature restaurants, and while you can eat at any Resort's restaurant, it's nice having such a dining experience close by.
I would closely examine your budget and plans for your vacation. If you feel that the cost of a deluxe Resort may impact your vacation, then you are probably better off staying at one of Disney's moderate Resorts.
Port Orleans French Quarter, small and picturesque, is a favorite of mine.
Enjoy your vacation.