Chato's is great for location and cheap rooms. That said, I would have much rather paid an extra $10(USD) (even $20!) a night and stayed in Palenque Town (rather than Panchan) had I known what our experience would be like. We had a screened in cabana with a fan, but the fan barely pushed the air around and the room was incredibly hot and sticky. The bathroom was about what you'd expect for a cheaper place-- lots of mildew, but running hot water and a private bathroom, so that was good. Sleeping peacefully was tough-- it was too hot, and the other guests were loud on the path past the rooms all night long. The screens to the cabanas had some holes, but they were taped up, so at first I thought, "hey, no big deal," but then we learned the hard way that holes in the screen near the door just mean that someone can pull back the tape, reach their arm through and open your locked door from the inside. So... our room was broken into and our stuff tossed everywhere while we were getting a beer at the bar. Luckily we didn't have anything worth stealing, but it still sucked. The staff was sympathetic but pretty ineffectual in their response to the break-in-- they still charged us for the night and weren't able to offer us a different room (or even bother patching the now-gaping hole in the screen).
Overall, I recommend you stay elsewhere if you can afford it.