There are no hotels within Arches Natl. Park but the town of Moab is only a few miles from the park entrance. You're right, "luxury" is not a word to use in Moab but we have tried several of the motels in town and like the Best Western Canyonlands Inn the best. It's nothing fancy (nothing in town is) but it's clean & conveniently located right in the center of town with plenty of restaurants within walking distance. I believe there are some fancy hotels (guest ranches) outside of town but then you'd have a pretty good drive if you're going into to town for dinner.

The hotel serves a "free" breakfast in the lobby but we skip that and walk a block down Main Street to the Jailhouse Cafe for a terrific breakfast, just what you need before a day of 4-wheeling and hiking. For dinner there are two very nice "gourmet" restaurants in town the "Center Cafe" and "Desert Bistro", both within walking distance of the BW.