Indeed there is quite a big event happening in Koln soon (Carnival!!). I lived in Bonn for a couple years recently and having been to both cities I would offer you a new recommendation, Koblenz. There are a couple really nice museums there and fort Ehrenbreitstein which sits looking out over the Rhein.
That being said if you are interested in large street parties and dressing up then Koln might be the best option for you. If Hotels are expensive their you could get something in Bonn (which is a neighbouring city, but kind of a suburb) and a simple intercity train gets you to the centre of Koln in 20mins. NB Koln/Bonn share the same airport which is between them in case you are flying in.