I have been to WDW twice in mid-August (2005 and 2006) and it was definitely hot, but the crowds weren't too terrible. I was also there in July 2000, and will be going back July 2009 (we're going to be restricted for family trips now since my sister is a school librarian).
It is definitely going to be hot and rainy, but IMO, it's how you approach the whole thing. Bring a poncho and look at the rain as an opportunity to walk on what all the rides while the chickens run for cover.
Use the heat as an excuse to see HoP for the first time (or 10th time) in five years. Or better yet, as an excuse to get a Mickey bar or a sundae from Auntie Gravity's (my mom's favorite in the World).
As far as the lines go, we combat those any time of year by getting up insanely early to get into the parks at opening (or EMH). You can hit several major attractions before the majority of crowds (and the worst part of the day weather-wise) hits. Then, go back to the hotel for a dip and/or a nap, check out the BW shops (and Seashore Sweets, yum), or DTD.
Then, when the heat is tempering off and it begins to get dark, take your re-charged selves back into the parks to get on whatever you missed. Stay until park closing (regular or EMH)...you can get in a queue until literally the minute the park closes! Just as you're hitting your PM stride, all the weary people who've been in the parks all day will be heading out. Also, if you have already seen parades and fireworks, use those times to get on especially popular rides.
Now, in the busy summer season, it's not going to be dead at night, but the crowds will be substantially better than during the day, and without the heat exacerbating any grumpiness, you'll feel a million times better than if you were sitting in a 90 minute PP queue at 2:30 in the afternoon