I was just in Rio in April and stayed at the Sheraton. I used a UA 50% off award and the price was about $125 (can’t remember exactly). I am a Starwood Platinum member so I was upgraded to a corner executive suite. The room had floor to ceiling windows on both walls with three balconies. You could lay in bed and see the curve of Ipanema beach. Nice marble bathroom too.

As for your choices: Intercontinental

This is a modern architecturally uninteresting hotel located far from anything. I have not been in the hotel, but based on location alone I would not recommend it.

Copacabana Palace:

Beautiful 1920’s Hotel expensively and lavishly restored. The hotel has a beautiful ground level pool (rare in Rio) and is across the street from the beach. The basic rooms are small and will have no view. The location is good as you a right in the heart of Copa. It is very expensive, but if money is no object then this is the place to stay (unless you want more of a resort, then the Sheraton is better).

Sheraton:

This is the only hotel in Rio directly on the beach. It is also more of a resort hotel than the other hotels with three pools, tennis courts and various outdoor restaurants. The location is on a small beach south of Ipanema so you must take a cab or bus (frequent and cheap) to get to anything. You can also walk along the narrow curvy road to Leblon/Ipanema in about 20 minutes or so. When I was there the main road was closed one direction for repair, so this is a pain if still true.

To do:

The cog railway to the top of Corcovado, and the cable car to Sugar Loaf are the most famous things to do. There is also a charming old tram that runs from downtown to Santa Teresa up in the hills. This is an area of old mansions with great views. Downtown Rio is also interesting with various historic walking areas, museums, government buildings etc. You can see one of the Samba shows at night (very touristy, but still fun). There is now an on/off tour bus loop that runs in Rio. I found taking the bus almost anywhere in Rio to be interesting and scenic. A walk along Copacabana and Ipanema beach can burn up a whole day.