Hi Catherine,
I am glad that you are thinking about ways to maximize your time in the Walt Disney World theme parks.
Character dining in the theme parks is a great way to meet some of your favorite Disney characters and enjoy a delicious meal in the process. I think that your instinct is correct. Even if you have an early morning character dining reservation, you might find that it takes a while, and you do not want to rush this experience! I find that lines for attractions are lowest first thing in the morning, so this tends to be prime time to experience attractions, especially with little ones.
I suggest that you start the morning by grabbing a quick breakfast. My family often keeps simple breakfast items in our resort room to have before we head out, and we also keep snacks in our backpacks that we bring with us to the theme parks. Arrive at the theme parks early, even a little before opening time, and do your must-do attractions at this time. Make a reservation for either a late character breakfast or an early character lunch. This way, you can experience some attractions in the morning, and then as the crowds build and the day gets warmer, you can head into air conditioning, a meal, and some great character interaction!
A couple of my favorite character meals in theme parks include
The Crystal Palace in Magic Kingdom, where you can meet Winnie the Pooh and his friends, and
Tusker House Restaurant in Disney's Animal Kingdom to meet Donald Duck and his friends in their safari gear. Do note that character appearances are subject to change.
Please let us know if you have any further questions, Catherine!