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In addition to the R&C properties, there are also some small and romatic but modest hotels with top restaurants in the area, especially as you go into the Basque area close to the Spanish border, both along the coast and up in the hills. Don't expect true luxury but these sorts of places can be better experiences than some of the more renowned hotels.
I was never very impression by the Hotel du Palais or Biarritz itself, but I haven't been there since the hotel became an Orient Express property. I would assume that the Orient Express affiliation is very good news.