Staying in the town of Narita is perfectly sensible, but going to Tokyo is also possible.
With a 4.50pm arrival you have a good chance of catching the Keisei Sky Liner 38. It departs Narita Terminal 1 at 5.39pm and arrives at Keisei Ueno station at 6.24pm.
For your return to the airport, Keisei Sky Liner 13 departs Keisei Ueno station at 8.39am and reaches Narita Terminal 1 at 9.24am.
Plan on taking hand luggage only for this overnight stop. Your airline should be able to transfer your heavy luggage to the next flight and hold it overnight. If you stay at a hotel within walking distance of Keisei Ueno station, you won't have problems with rush hour.
If you want an extra few minutes in bed, stay at Nippori station (one stop before Keisei Ueno). However, the dining and hotel options there are more limited.