The Starhotels Michelangelo is an excellently located hotel if you're looking to spend time in Vatican City. It is about a 5 minute walk to St. Peter's Square, and appx 10 to 15 minutes to the entrance to the Vatican Museum.
The hotel itself was pretty nice. The staff was very friendly (I loved waking up and seeing the cleaning staff stop and say "Buongiorno!" to me every morning) and were able to converse in English. I had a ground floor room which meant traffic was somewhat noisy, and since the floors are wood I could hear the lady above me walk around in her high heels at night. There was a breakfast provided, but I'm not much of a breakfast person; from what I could see and smell though it looked great.
There is a small grocer next door to the hotel where you can purchase snacks and drinks. It is also about a block away from some restaurants including a good gelato stand.
I'd say the only negative of this hotel was that if you wanted to see the major Roman sites (Colosseum, Trevi Fountain, etc.) it's a pretty healthy walk to the nearest subway station.
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