You have been given stellar advice already about where to stay, park hoppers over single park tickets etc. I agree with it all. You can't go wrong with either hotel. We prefer GCH because of Grizzly Rapids. My family has a habit of riding this ride over and over at night until DCA closes and they squish walk back to the hotel room. (very close when staying at the Grand). I love staying here because I have a bad hip, and at night, every step does count for me.
As for Knotts, I suggest to go there at the beginning of your trip. We were at Knotts this past Friday. It opened at 10am and closed at 10pm. Check park hour times and ride closures on their website. You can purchase tickets for a discount online too. You can make a reservation online for Mrs Knotts Chicken Dinner Restaurant. I would highly suggest making the reservation if you plan on eating here. As for TS restaurants inside the park, I do not remember seeing any, or it could be one I think I saw in Ghost Town. Ghost Town Grill is a TS in Knotts. I can't recommend eating at Grizzly Creek Lodge. Family was not happy,(bad burger, salad just lettuce, list goes on) especially when we could have driven to DTD and eaten at Tortilla Joe's! There is a Panda Express and a Johnny Rockets in the park. Don't know if they take gift cards. The Coffee Hut inside Knotts sells Starbucks drinks, BUT does NOT take Starbucks gift cards. There is a Starbucks outside of the park that does. Loved the shows we were able
to catch. Some of the family loved the thrill rides. Some of the family loved the shopping.
Again, I suggest going to Knotts first, then end your vacation at Disneyland. Make magic morning/early entry every day, park hop using Maxpass, go back to the room for a quick nap/rest, then head back to the parks. Others here can tell you what shows, fireworks are shown only on weekends during the slow months.
What ever you decide, have lots of fun and make a list of what you want to do/see when you go back!