Your assumption is correct. Hotels are in good shape but neither one is close to the city center. Taxi is not very expensive, about 25-40 CNY per trip (less than $5 US), depending on the traffic. So it may still work out. I made a reservation at the Renaissance Yangtze Shanghai Hotel for the past Christmas but canceled later when Crown Plaza had a better rate. It also has a better location. Shanghai is a vibrant and exciting place to visit. Hangzhou, on the other hand, is a very beatiful and relaxing city. Things are also cheaper in Hangzhou.