Someone above asked about the Best Western Arroyo Roble - we stay here on our yearly Sedona trips and find the location convenient to our favorite place to eat in Sedona (Indian Gardens Cafe and Market - just up 89A) and to the rest of town. We've walked to L'Auberge for Sunday brunch with no issue and since we usually take mtn bikes with us, can just ride to most of the trailheads. The hotel is always clean and Lonnie, the manager, is a long time resident who can tell you anything about the area. Keep in mind that when we're on vacation, we are in the room to sleep, so while L'Auberge is certainly a much nicer hotel, we wouldn't spend enough time there to make the price difference worth it. We haven't been terribly impressed with the food in Sedona - most of it seems touristy and made for the masses, but you can definitely find some places off the beaten path. We found a small, nondescript Mexican restaurant last year and it was better than Javelina and other places on the strip (I think it was called Tortas de Fuego - it's in front of an auto body shop).
For those who want a grocery, there is a small Whole Foods with a decent deli and salad bar. Bike and Bean is my normal coffee stop while in town, plus they offer bike rentals if you don't bring your own. We always do a loop with Submarine Rock to get in some classic slick rock riding, but we rode up Broken Arrow + Chicken Point last summer and it might be my new favorite. We usually ship our bikes out, but Bike and Bean has a great selection of hardtail and dual suspension bikes (road bikes as well if you're sticking to pavement).