I agree with Heather on Hotel Cielo. I went to a party there a few weeks back and it's very nice. Sneak upstairs to the rooftop and see the lights of Cozumel.
I also really like staying at the
Alux hotel. Great location (just a 1/2 block down from La Tortuga), Clean room, newer building, outstanding water pressure and hot HOT water to boot! Cheap too.