Hilton Santa Cruz, Scotts Valley
Coast Santa Cruz Hotel
Just about anyone in Santa Cruz can tell you about this hotel (it used to be called the Dream Inn, and then the West Coast Santa Cruz Hotel). It is right on the beach front of West Side Santa Cruz, with a great pool/hot tub setup that overlooks Cowells beach and the beginning surf area. Down on the beach you can rent wetsuits, surfboards, body boards, etc. It's also a nice place to just relax on the beach.
The hotel itself is located right next to both the wharf and the Santa Cruz Beach Boardwalk. There are a number of nice restaurants in easy walking distance (a must see is Ideal bar and grill). The wharf is a great place to go for dinner if you want nice ocean views and don't mind shelling out a few extra bucks.
As for the hotel itself, the service is generally considered to pretty good, but it is a bit of a "busy hotel." By that, I mean it's crowded. There are tons of rooms and it's sort of an in-your-face hotel. I wouldn't recommend this hotel to people looking for seclusion.
Another great feature of this hotel is its proximity to Santa Cruz's famous West Cliff Drive. You can go for a nice walk down the cliffs. In about an hour or so you should be able to walk from one end of west cliff to the other. The views and scenery are really amazing.