We did this in May last year. The food was good and the view of the parade was good too. The area is a bit elevated over the crowd, so from a seated table you can see all the floats and a decent amount of whats on the ground/walking around. Kids probably won't be able to see the walkers, but it's still a good view.
We'll probably do it again, it was nice to see the parade and eat at the same time. Like others have said, you do wait longer for a table since you have to request a patio table and there aren't many tables. Maybe 12 as someone else said.
It was a mid 90s day when we were there, but with the sun down, it actually felt pretty good and Tony's is one of the only places in WDW that serves sweet iced tea
I've heard some of their pasta dishes taste very olive garden'ie and generic. My wife and I both had lamb shanks, so I can't comment on the pasta sauce type Italian dishes. The calamari was acceptable, border line good, but nothing special. We had calamari somewhere else on property which was very good, this was, like I alluded to, olive garden-ish.
The kids... I forget what they ordered, one had a pizza for sure. We had a huge lunch at LTT that day and a snack mid day, so they didn't eat much for dinner and they didn't have any "good" choices for the kids menu there. IIRC it was pizza, spaghetti and nuggets. No mature choices that I can recall.