We watched from the balcony at the Contemporary - you exit near the giftshops on the same floor as Chef Mickey's. (I think it's the 3rd floor). Stand at the far end (closest to the lake and MK) for the best views. They pipe in the music and there weren't many people there when we watched.
I think you can also go the California Grill for a drink in the bar and be able to view from their balcony which is supposed to be the best views outside of the park. (If you go with this option be sure to verify you can go to the bar without dinner reservations - I know there is a special elevator for the restaurant and I'm not sure if they have any exclusive rules for the bar)
Another option would be taking the monorail to the Poly and watching from the beach there - another favorite of many DISers.
Enjoy!