Agreed. As a first time trip and on the basis of a limited time frame (2 nights), the Sheraton is probably a better bet. The Sheraton has been remodelled and I certainly wouldn't call it "beat-up". As Plat, you probably have a better chance to score a suite upgrade there.

Having said that, if you think the LM is a better deal, getting to/from the LM is not a big deal. At worst, it's about a $70 HKD taxi to/from Central. Given the difference ($60 USD vs ~$200 USD, the LM is a better deal even if you factored in the taxi trips). But, it is removed from the action...