Sapient animals in fiction and film range all the way from creatures that live and act like their real-life counterparts but communicate with language among themselves, as in BAMBI (the book, not the Disney movie, which anthropomorphizes the characters a bit more) and WATERSHIP DOWN (in which the rabbits have myths and legends as well as speech) to what a friend of mine calls "zoomorphic humans," characters who look like animals but for all intents and purposes are human, as in the Arthur cartoons and the Berenstain Bear series.
TV Tropes has a page exploring this range:Sliding Scale of Anthropomorphism
The creatures in MRS. FRISBY AND THE RATS OF NIMH behave much like "normal" animals and birds, aside from the intelligent rats whose human-like minds are explained by the scientific experiments performed on them. The animals in the Narnia series present a special case, since most of them are natural beasts like the animals in our own world, but the "talking animals," uplifted by Aslan, interact as equals with human characters and sometimes wear clothes and use technology. The animals of the all-animal Redwall world behave like people but retain some of their species traits, especially the conflicts between prey and predators (almost all of whom are portrayed as villains). ZOOTOPIA, set in another world with civilized animals and no human beings, makes a conscientious effort to "show their work" as far as species traits are concerned, including drawing the various types of creatures more or less to scale. And, of course, the fraught relationship between predators and prey is central to the plot. The animated stuffed toys of the Winnie the Pooh series act in most respects like people but with some token nods to their animal natures, such as Owl living in a tree and Rabbit in a burrow. The animals of THE WIND IN THE WILLOWS occupy roughly the same level. They live in a world where none of the human characters seem surprised to meet what C. S. Lewis called "dressed animals." Snoopy in the "Peanuts" series began as fairly doglike and gradually became more anthropomorphic. The Disney cartoons present the odd situation of some "animals" being essentially zoomorphic humans, such as human-sized Donald Duck and Mickey Mouse, while others—e.g., Pluto, who's smaller than his master, the "mouse"!—are simply animals. Chip and Dale, the chipmunks, lead a natural tree-rodent lifestyle but seem able to understand and speak the language of the more anthropomorphic characters.
What does an author gain by portraying almost-human characters as animals? In the highly didactic Berenstain Bears stories, the characters' ursine appearance and names probably offer the "spoonful of sugar" needed to make the "medicine" of the lessons go down easily with the target audience. Child readers can enjoy being taught through stories because of the distancing effect of the animal guise (as well as the light, humorous approach to most of the problems). In the GET FUZZY comic strip, the dog and cat behave like unruly children rather than pets, even more so than the comparable characters in GARFIELD (which at least act canine and feline part of the time). The cat, Bucky, is even expected to clean his own litter box. The dog, Satchel, appears to be mentally challenged. Bucky is downright sociopathic in his disregard for the rights and feelings of others, especially Satchel. If these creatures were human children, the family would be in therapy. By drawing them as pets owned by a put-upon bachelor, the cartoonist can pass off the strip as humor. (As you may guess, I find it more unpleasant than funny.) Similarly, classic cartoon characters such as Donald Duck and Bugs Bunny can get away with actions that wouldn't be accepted as funny from human actors, because Donald and Bugs are nominally animals.
C. S. Lewis addresses this question in regard to THE WIND IN THE WILLOWS. He suggests that making the characters animals allows the author to give them the incompatible freedoms of both adults and children. Mole, Rat, and Toad (who's more anthropomorphized than the others) enjoy complete independence, like adults, but they're free to "play" all the time with no need to work for a living, like small children.
When animal characters have any degree of human-like intelligence and personality, they satisfy one of the desires often fulfilled by extraterrestrial aliens—they let us imagine interaction with nonhuman people. As Tolkien says, animals are like foreign countries with which humanity has broken off relations; we yearn to connect with them.
Speaking of animals, happy Groundhog Day (aka Candlemas)!
Margaret L. CarterCarter's Crypt