Is it true they are at MK'S Tony's?

Unless this is something they very recently added, no. There is a lovely Lady and the Tramp fountain in there though.

You mean as walk-around characters? I have never heard of that, or experienced that when eating there.

Their paw-prints are outside on the sidewalk, though.

I read it in Zagats 2007 WDW book!

We were there at a very busy time of the summer for lunch and didn't happen to notice anything of this sort. Pretty much everything in the place looks like Lady and the Tramp threw up on it though. And the fountain in the middle is lovely. This is DW2B's fav Disney movie and we took a very lovely photo in front of the fountain. They play Lady and the Tramp on the tv in the lobby, they have lithos on the wall, checkerboard tablecloths, the whole nine yards, but no actual character meet and greets, unless, like someone else stated, they added them very recently. You could talk to the statues if you wanted I suppose, but they might call security on you at that point ;)

Cool Runnings!
Doc

but you're right, Tony's Town Square cafe recreates Tony's Italian Ristorante from the film but Lady & the Tramp don't appear in the fur.... and really, how could they??...do you want them walking around like Scooby Doo or Pluto? Hell, no!!!

Is the food good at least? sp and meatballs??

I had a penne dish with sundried tomatoes and artichokes, it was very good. Hubby had some kind of salmon I think. kids had a panini and pizza. They liked it. The atmosphere was nice on the day we visited. We were in the front atrium type room, had a good view of Main Street, it was nice to watch everyone hugging the plushies outside, while we had lunch. The service was great. The prices were reasonable. I would go again. Not every time, but it's worth a revisit.

We always end our week at Tony's. Spaghetti and meatballs are the comfort food we seek after a grueling, fun-packed week at the world. If you are a fancy-diner you may be unimpressed. But if you like simple food that tastes really great - it's hard to beat!! :D