I will check this hotel also.
That's a lot of train travel for 5 hours at machu picchu...which is our primary reason for visiting Peru in the first place.
I need to look at staying a night in Agua Calientes (sp?) so we can get a nice full day at MP without the long train ride on both ends...
Anita
... and you have to deduct about 1h for bus ride/wait to get up to and down from the ruins. Train travel time from Ollantaytambo is only about 2h per way, so no problem to do a return the same day. Aguas Calientes is a quite boring place catering mainly to backpackers. There are (a few) decent hotels there, but do you want to take all your luggage with you on the train?
Another point you should consider is altitude. Sacred valley is your first day in altitude and you may want to keep it as low as possible to avoid soroche (altitude sickness). Ollantaytambo is about 200m lower than Urubamba and about 600m lower than Cuzco.