We stayed in Port Angeles for our visit to the Olympic Peninsula. I highly recommend staying in town here if you are going to want to dine out and do any shopping. You can also hop the ferry to Victoria, Canada for a plethora of other activities to explore. Don’t forget your passport or National ID card!
We ended up staying at a place called the Downtown Hotel. It is not for everyone and I was a little nervous about it but it ended up working out well for us. They do have a couple of regular on suite rooms, but mostly it is a Euro/hostel style hotel with shared bathrooms in the hallway. You also have to drag your luggage up one or two flights of stairs depending on which room you end up with. I will say that the rooms were clean and spacious even if sparsely decorated. There also is no air conditioning but even in late July it wasn’t needed. We were able to open the window and they provide an oscillating fan, we were perfectly comfortable. All in all, I would stay here again if I’m not able to stay at Lake Crescent inside the park itself.