Thank you all especially KI-NRT san for the many recommendations. My wife and I recently had a wonderful two night stay at Nishimuraya Honkan. We did have the "Superior Matsuba Crab & Tajima Beef Kaiseki" our first night which was simply fabulous. The second night was also wonderful, still with a few crab dishes, but mostly other wonderful dishes. We stayed in the Sakura room with a beautiful view of the garden and very spacious. Service was impeccable. The breakfasts, served in the large room on the second floor (forgot the name) was also just great. We visited three of the town onsens, as well as the ones in the ryokan. We were slightly surprised that many of the stores and shops were closed, this was in mid November, although more were open on a Friday.
Our trip also included Yoshikawa ryokan in Kyoto, as well as Benesse House on Naoshima, Atami Karaku Hotel, the new JW Marriott in Tokyo and the Osaka Station Hotel. Already thinking about more onsen ryokans for another trip!