My family has been staying at the Danieli for a long time...in our collective opinion, it is the best hotel in Venice. You must, however, make sure that you get a room in the old section of the hotel. And you should take the champagne breakfast on the rooftop terrace each morning.

I know others like the Gritti Palace, but I prefer the Danieli. And you probably don't want to stay in any of the Lido hotels since they are somewhat far away and it won't be beach weather in March.