Note that I don't have kids, so before this question I knew very little about the dependent care credit or dependent care FSA, so take this with whatever grain of salt that merits.
I just took a look at
Form 2241 - Child and Dependent Care Expenses and I think I figured out what's going on. The dependent care credit is calculated based on the your actual dependent care expenses or $3000/dependent up to 2 dependents ($6000 max), whichever is less. If you receive dependent care benefits from you employer (box 10 form W2), which I think is your FSA then, as you pointed out, the amount of expenses eligible for the credit is reduced by your dependent care benefits. So if you contribute the full $5000, then the the expenses the credit can be based on is at most $6000 - $5000 = $1000. So basically you can get a deduction for at most $6000, and that's split between the FSA and the dependent care credit.
The dependent care credit is based on AGI (line 38, form 1040) with different amounts of the deduction ($1000 or $6000) being multiplied by between 20% (any AGI over $43k) to 35% (AGI under $15k). You should be over $43k AGI, so your credit will either be $1000 x 20% = $200, or $6000 x 20% = $1200, so a $1000 advantage to not using an FSA in terms of the credit.
If you use an FSA you shouldn't pay FICA on the contribution (check with your employer, but usually these are run through a section 125 "cafeteria" plan that avoids FICA), so that's $5000 x 7.65% = $382.50 savings, meaning the advantage of not using the FSA drops to $1000 - $382.50 = $617.50. Since you'll also get a federal and maybe state tax deduction on the FSA contribution, that means if your marginal federal (and maybe state) tax bracket is anything more than $617.50 / $5000= 12.35%, then the FSA is better, and if it's less then skipping the FSA is better.
I just realized I took a kind of backwards approach to that, but I'll leave it since it might help depending on how you think. Another way to think about the marginal rate breakeven point is the 20% from the form 2241 table minus 7.65% FICA, which is also 12.35%.
So really this comes down to state taxes, because I think you should be in the 12% bracket, so as long as the dependent care FSA is deducted from your state taxable income and your marginal state bracket is more than 0.35%, then you should come out ahead overall with the FSA.
It looks like you're saying you also get $600 in the FSA from your employer if you contribute? That changes the math (in your favor) since it gives you less space to contribute, but also free money! So then, the FSA advantage becomes $4400 x 7.65% = $336.60 FICA savings plus the $600 free money advantage is $936.60. Compared to the $1000 No FSA advantage, that's a $63.40 net No FSA advantage. So as long as your marginal Federal and maybe state tax bracket is more than $63.40 / $4400 = 1.44% (which it definitely is), then the FSA is better.
Of course, the flip side is that by reducing FICA you're reducing your eventual social security benefit, so there's that to be considered too.