We were Disney junkies long before we moved to Florida. Now we have a Florida Residents' Pass. I mention this because what follows is based on real-life.
Here's the deal: Did you tell the agent you want to go all out and give them the best facilities? Because that is what the agent gave you, the most expensive places in the joint. They also are not necessarily the most kid-friendly places, either. What kind of place is the Floridian? They serve high tea every day. If features like that will impress the family that's going, this is the place for them. If not, you are being steered in the wrong direction.
If the family is going to the park every day, why in the world would you want to spend all that money on a hotel room they see only when they go to bed? If you want to spend lots of money on a hotel, you could do the Yacht or Beach Club, which share what, IMHO, is the nicest pool ever. A wonderful water slide, sand-bottom pool, lazy river, and all sorts of other stuff. These hotels are $400+ a night per room, but at least the kids get something to do. In fact, they could plan a whole day never leaving the hotel property.
There are an infinite number of ways to spend less on hotel rooms. I do not mean to be cynical, but I am not impressed that the person who gave you prices and is someone's friend is not doing you any favors by giving you the most expensive deals in the house.
Swan and Dolphin are nice, but I hear (not from personal experience) that the rooms are small, and I've never heard that they were all that attractive to kids.
A nice compromise might be Caribbean Beach. It's on the Disney bus line, so you don't have to drive to the parks, and it has a really nice kids' pool with a slide. It's better than the All-Star Resorts, which are kind basic, and it is more expensive than it should be, but that's true of all Disney resorts. It also should be a bunch cheaper than the Floridian.
So some questions to ask: When in January? The date may make a difference in terms of price. You need to ask.
What other hotels might be okay? Find out if the kids are really looking forward to visiting Animal Kingdom. If so, there are hotels on the edge of the property, from some of which you can see some of the African animals. Very cool. Expensive, but at least the kids are a reason for booking there.
Do they need the full meal plan or the lesser one? The full one gives you more sit-down meals. I think the lesser one gives fewer full-service meals and more cafeteria-style meals.
I am assuming these prices include park admission, yes?
As someone mentioned, there are family and "value" resorts. We stayed a night in Pop Century recently and did not really care for itl, but that's just us. All these "value" places have one real plus: a food court where you can eat more cheaply than you would be able to otherwise.
You need to think about the fact that with two adults and two kids, the schedule will largely be determined by the kids' stamina and attention spans. Also, what kind of shape is Grandpa in? You know the saying -- EPCOT stands for Every Person Comes Out Tired. They are not kidding, The place is gigantic.
For whatever it's worth, I'd be happy to help with this and also to suggest ways they can see the things they want to see without wasting time on things they really don't want to see. (Every year when I took my daughter, I mapped out a plan with the order in which we would try to ride all the riders. Now she has two kids and, technology being what it is, she has a color-coded time chart that does the same thing. There is just too much to see, and never enough time or energy, so they have to be prepared for that.
Send me a message offline if you want, and I can be more specific.