For Pilgrims, this hotel and the Knights Palace which is around the corner cannot be beaten. They are located right in a key part of the city with easy access to the Church of the Holy Sepulchre, shopping, etc.
The staff is great, friendly, and will look out for you when they can-giving you tips etc. to save money and time. The food you should get WITH the room as you can really save this way if on a budget. You will be FILLED as the chef puts out quite a spread. The food is Mediterranean/local and very good, nourishing etc. which is what your poor legs and worn out body will likely need!
For cash machines, DO NOT use the one out towards the main street on the corner or any other ones in the area-walk out the Jaffa Gate and down the hill to the upscale shopping street-about halfway down on the left is a REAL ATM with minimal fees, awesome exchange rates etc. Its on the front of a bank.