Bay Lake Tower is a Disney Vacation Club property; it is connected to the Contemporary resort by a skybridge. The property opened in 2009 and features studio, 1br, 2br and 3br villas (including massive "Grand Villas").
We stayed in a 1br villa last year and it was perfect for our family of 5. There is a king bed in the separate bedroom and a sleeper sofa and sleeper chair in the living room. There was also a full kitchen (studios only have kitchenettes). 2br villas are a great option for large families - they sleep up to 9. Most views are either of Bay Lake (with the nightly water pageant) or Magic Kingdom (with the nightly fireworks).
The absolutely best feature of Bay Lake Tower? The ability to walk to the Magic Kingdom! You can be at the entrance of the Magic Kingdom in 10 minutes. Of course, you are also on the monorail, so you can take that if you want to save some energy or if you are going to Epcot. To help you determine if Bay Lake Tower is the best option for your family, check out my pros and cons below