Late August or early September is a great time to visit. August will be busy as it is peak season for Italian vacations, but if you can get lodging, the trails won't be too crowded. "Really nice hotel" is not something we seek out. we are more pensione or B&B people, and we often rent apartments. Here are a few we have enjoyed, though.
Hotel Albion is the most posh place we have stayed in Ortisei. It is a bit outside of town, but they have an on-demand shuttle to the lifts and to the village. Half pension, very nice.
Residence Astoria has lovely apartments with great views over the valley. We spent a month here last summer.
Villa Aurelia has B&B rooms as well as apartments. Right on the main street a five-minute walk from the bus piazza.
Hotel Garni Walter is a pensione and very nice. A short uphill walk from the center.
Gran Tubla is high above Ortisei to the north and has lovely apartments. I think they do B&B as well. You'll want to take a taxi up here when you have luggage, otherwise walkable.
There is plenty of hiking in the Val Gardena for three days. No need to make the long drive to the Tre Cime. The Alpe di Siusi is right above Ortisei, you can go to Selva and hike at Passo Sella, plenty of challenges at Seceda as well. Your lodging will give you a pass for using local buses during your stay. Buy a Val Gardena pass for the lifts.