Disneyland for New Years

Don't. Seriously, the week between Christmas and New Years is always the busiest time of the year for any park, especially Disneyland due to it's popularity with locals. If you can manage to go when schools start in January, I would strongly recommend it. If it has to be New Years, be prepared for massive crowds and the likelihood that the parks will close to capacity. Make sure you're at Downtown Disney at least 30 minutes before the parks open and hit the headliners first. If you want to catch a parade or fireworks, find a spot and stick to it at least an hour beforehand (many will be setting up camp 3 hours beforehand).

Camping for three hours? I thought Disney no longer allows that.

If last year is any indication, the week between Christmas and New Years may actually be the best time to go if you go during winter break. It will still be extremely busy, but with most of the APs blocked out I don't expect to see capacity crowds.

Fortunately, four days should be plenty of time to do everything even when it is crowded. General advice for busy periods would be to get there at opening and do as many high popularity/low capacity rides as possible in the first couple hours, make use of Fastpass as much as possible, stick to one park per day to avoid losing time due to park hopping, and try to minimize backtracking in the park. Expect wait times of 60-90 minutes for most E-ticket attractions and anything else with low capacity. Also expect long lines for food if you eat at regular meal times (I suggest a big breakfast before arriving, a late lunch (~3:00 P.M.) and a late snack rather than dinner to get around that). If you decide to go, I can give you a more detailed plan closer to your trip.

If you know what to expect, it is entirely possible to visit and have a good time right around New Year's. In fact, it is probably the best option if you must go between mid December and early January (you definitely want to avoid the weeks bordering the winter break blockout). You just need to be okay with long lines and accept that you'll likely only get to about 15 attractions per day. If you can deal with that, it's definitely better than not going at all.

@Randy, I haven't heard too much about Disney's success on that count, but I'm willing to bet that some will find ways to hold onto those spots, even if it doesn't necessarily mean laying down blankets or sitting on the curb.

Thanks AJ for the tips. We are expecting it to be very crowded if we do decide to go, but unfortunately we can't go any other time.