There is no tax on retained earnings and taxes on dividends and capital gains are the same, so there's no advantage there. Those taxes are paid by the shareholder, not the company.Disney has been buying back shares for years, they only said they will double the volume in 2014. A company buying back shares in no way helps it go private. A company can not own itself, an invester would have to purchase all outstanding shares to go private. As shares are bought back, the number of outstanding shares is reduced and the value of the company is then spread across fewer shares, thus raising its share price. This is a method of returning value to shareholders while avoiding taxes on dividends and (I believe) retained earnings. Disney can either retire these shares (removing them from the market permanently) or hold them as treasury shares to later distribute as employee incentives or sell on the open market. However, if the shares are reissued, that would dilute the market and lower stock value. This would normally only be done if the company thought its shares were significantly undervalued and selling at a later date could generate a greater return than the diluted value.
As for it being "better" to spend the money on the parks, for many accounting and tax reasons, it is often better for a company to use cash to buy back shares and then borrow money for capital projects. I don't fully understand it, but it comes down to doing everything you can to increase the value of the company while minimizing the taxable earnings.
Buy backs can be part of a going private plan. Happens all the time. By getting cash cash out of,the company in buying shares, you reduce the total value of the company. That makes it easier to fund a going private transaction. Moot point for Disney -- this buyback is a drop in the bucket.
The share price should not go up when the company pays $65 for something trading at $65. If it does go up, it isn't due to the Buyback itself, but due to the market believing the company is signaling good times ahead by buying back stock. In other words, the company, which knows more about its future prospects than anybody else, is saying its rock is undervalued. If the market believes that, the stock price will go up.
Reissuing shares at fair value does not dilute the value of other shares.
As for the cost of debt v equity financing, there are a number of reasons that might favor debt financing right now, tax included. But Disney hasn't made a move to issue debt, and most believe the cost of debt will go up soon, so if Disney had plans to borrow, they'd probably be jumping in now, and they aren't.