I highly recommend Desert Palm Inn & Suites, which is right in the same vicinity as Candy Cane and Portofino. It is a doable walk...especially since Desert Palm is close to the convention center walkway that goes directly into the Timon parking lot. From there you can take the tram to the main esplanade.
We stayed here for our honeymoon, and found it to be a beautiful property with a lot of amenities for a not-so-big-price. (We found a great rate on their website.) They have suites as well, in case you need extra space for your family. A lot of their suites overlook DCA!
They have a good-sized continental breakfast in a room with a gorgeous DCA view, and they play Disneyland music outside their front doors 24 hours a day, so you always have a festive feeling when coming or going!
