Hmm, we were planning to do similarly for our trip last year. But after advice from people in FT and following discussions with my UK relatives, we decided we were better off with a couple of days/nights on the England south coast rather than going over the Isle of Wight. The ferry trip was desctibed to us as the most expensive water crossing in Europe!
We had originally booked for two nights at the Travel Inn on the Isle of Wight, but ended up cancelling and then struggled to find accommodation for seven people at short notice in summer along the south coast. We ended up with three rooms at a pub in Dorchester, which ended up being great.
As for the ferry crossing, we didn't get that far down the track with booking it. Is it cheaper to book now or the same price if you book closer to travel date? If you can wait until you have the hire car you will obviously know the details.
Otherwise see if you can book with details like "Hertz rental car - compact" or whatever type you have booked. The only reason I can see that they would want to know is for space/weight considerations.
I seem to remember that there are two ferries (at least), one from Portsmouth and one from South Hampton I think. We were planning to go over on one and back on the other, but I have no idea of the costs expect that it is expensive.