I think you need to consider your audiance here on this discussion board site. By definition you are asking a bunch of Disney nuts. Most (myself included) will certainly always say that staying on-site is the way to go.
I see just a few reasons why people stay off site.
1) They don't realize that staying at a Value resort isn't really slumming it as they are quite nicer than most people understand.
2) They are interested in the bottom line and even though onsite magic, transportation time, proximity, etc... are all costs, they are not financial costs and many people do not consider them.
3) Lots of people aren't nuts about Disney (at least first timers who have never been :sohappy: ) and are only going on vacation to bring the kids to Disney World, even though they might not even want to really be there themselves. For them, staying off site is a way to give themselves a mental break and maybe keep the kids from getting over stimulated by Disney Everywhere.
I feel that it's up to each family to do the research so they know the options and prices, then weigh them all against their own preferences and whatever value they place on things like rental cars, home cooking, atmosphere, Extra Magic Hours, etc...
Personally, I always stay onsite, but also prefer to rent a car as well.