I picked Kasteli more or less at random but I'm so glad that I did. The reasons that this is the place you should stay are:
1) Location. It is exactly centrally located to everywhere you would want to be in Chania, including being only steps from the harbor. However, since it is on the hill in a courtyard it manages to be quiet. After seeing the town I realized how much I lucked out by picking the quietest possible place that was still very close to everything.
2) The kitchenettes. At least my room, and probably all of them, have a refrigerator, sink, hot plate, and dishes and silverware. This is perfect for having breakfast at the place and storing your restaurant leftovers.
3) The owner, Alex, will help you do anything you need, including renting a car. He has a small parking area which they will deliver the cars to and pick them up from. He's also always happy to make coffee, and it is real coffee, fresh ground and in a french press, not the terrible stuff they are mostly serving around town.