I still go with my suggestion of the Pelangi Beach (Singapore forum) - the rooms are not 'crappy' neither are they up to the standard of a 5* resort- you will only get that at the Andaman or the Datai. The rooms are fine - they are basic wooden villas in the local style with wooden floors -clean with all the amenities aircon etc you need for a beach holiday and you are right on the beach if you get a seaview room. I didn't eat in the hotel very much - just a couple of lunches by the pool but it is just a few metres along the sand to the Casa del Mar , Beach Garden Resort, etc on Cenang Beach. have a look at the reviews(mixed!) of the hotel at the website through which I booked -
www.asiahotels.com.