Palermo accommodations, best location?

When you make your trip to Trapani, be sure to get an early start so you have enough time for Erice as well. I would have liked to stay longer there. Trapani itself is also nice, as is Cefalu.

Try to stay between the Teatro Politeama and the Fontana Pretoria, more or less somewhere along the corridor between Via ruggero Settimo/via Maqueda and Via Roma. Basically the Teatro Massimo is the center of it all.
Don't go south/south east of the Fontana pretoria near the station. The Kalsa district is kind of a casbah that will make you feel uncomfortable.

I stayed at Hotel Posta in Palermo on an RS trip several years ago and the location was ideal. We were able to walk all over Palermo and see the market, the cathedral, four corners, park... just to name a few places.
I used this site:
Best of Sicily

There are hundreds of links to all thing Sicilian - great for planning and info.

I stayed at Hotel Ambasciatori on via Roma. It's an easy, straight 10-minute walk down via Roma from the train station. The room was adequate and comfortable (but with almost no natural light). Had I been a little less zonked and a little more savvy, I would have asked for a different room, but after unpacking and spending a night, it wasn't worth the effort to change rooms. They have a rooftop dining room with a great breakfast buffet and lovely views of the city. I would definitely stay there again if I were to return. It's central, walking distance to many of the sights, and very close to the big market. I took the train to Cefalu for an overnight and left most of my luggage at the Ambasciatori. When I got back, I picked up some picnic goodies at the market, then took a taxi from the hotel to the car rental and on to Trapani and Marsala and much more. You can also get the bus to Monreale from the piazza in front of the train station.

I actually spent 2 nights in Cefalu, taking a late afternoon train there and an early train back to Palermo. I enjoyed it even more in the evenings, though it was the most expensive place I stayed in 2 weeks in Sicily (and at a budget hotel!).

I stayed inside the Cathedral precinct, at B&B Federico Secondo, very nice and convenient.

Try to get to Segesta, Google some images to see why.

Here's my review of the B&B I stayed in; I'd stay there again without hesitation. The neighborhood was great: https://community.ricksteves.com/travel-forum/italy-reviews/palermo-bed-and-breakfast-la-bella-vita

We stayed at the hotel del Centro 3 years ago and loved it. It's near the train station, clean, inexpensive, nicely decorated, large and bright room, huge bathroom, balcony overlooking the nice tree lined shopping street (actually our balcony was off of the bathroom!! Weird!) and included breakfast. I wouldn't stay anywhere else if we're lucky enough to return.