Interpretations:Other Father Song
If you see the movie the song is pretty self explanatory. Something to note is the use of "button" and "eyes" because the Other Parents have buttons for eyes.
Also in the movie [spoiler ahead], the Other Mother spies on Coraline using a doll that looks just like her (and has buttons for eyes). "She's a doll ... Our eyes will be on Coraline."
"She's a peach" could be a reference to James and the Giant Peach, a similar stop-motion animation feature made by the same director as Coraline. It is also a way of saying that Coraline is cute and someone they will try to, later on, keep for themselves.
The Real Chords
A F# D A F# D Makin' up a song about Coraline
A F# D Bm D E She's a peach, she's a doll, she's a pal of mine
Bm D E She's as cute as a button
F# D E A D E A F# E In the eyes of everyone who ever laid their eyes on Cor-a-line
Bm D E When she comes around exploring
F# Bm E Mom and I will never, ever make it boring
A D E A D A Our eyes will be on Coraline
Spoilers!! I took it as a warning to Coraline, "as cute as a button in the eyes" warning her what the other mother will try to do, "she's a pal of mine" saying he is on her side, "when she goes around exploring, mom and i will never ever make it boring" they will do what they can to keep her interest, and finally "our eyes will be on coraline", they will spy on her to give her exactly what she wants in the other world, like the Wybie who can't speak. Obviously Coraline doesn't understand until the Other Mother and Father showed their true colors.