I second the Miyako in Kyoto as a good place to stay. As well as Western-style (i.e. pretty non-descript)accomodation, the Miyako also boasts a number of traditional Japanese rooms - surrounded by beautiful gardens - separate to the main hotel building. Its a very peaceful and relaxing environment and a great way to experience Ryokan-type accomodation whilst enjoying the conveniences of a major Hotel.
If you're heading down to the south of Japan, you should also visit ***uoka - great shopping, nightlife, galleries etc. Besides, the (very pleasant) Hyatt there is a good deal cheaper than the PH in Tokyo