Is this on one ticket, if so 1 hour is fine, as you say no need to do security again and you could be rebooked onto the 3pm if the domestic is delayed (as long as there's space obviously)

If separate tickets close to no chance as you'd need to wait for bags (could be hours), recheck them then enter airside 35 minutes before departure.

As for hotel, well if you would have a hotel room in Edinburgh anyway then it doesn't make much difference to stay at Heathrow instead. If coming from home the decision may change