sue,
Some suggestions....
- Lucerne - Hotel Stern
- Bern - Hotel Continental
I don't know if these are considered "inexpensive" as you didn't provide any information on your price criteria. I should emphasize that Switzerland is expensive so budget accordingly.
Check your local Library or bookstores to find copies of the RS Guidebooks for each of the places you'll be visiting. The books have good information on hotels in each location in different price ranges, and will also provide lots of information on sightseeing, transportation, etc.
Regarding which Swiss Pass to buy, you'll need to do some number crunching based on where you'll be travelling while you're in Switzerland. There are a lot of different passes and it takes a lot of time and effort to wade through them all. You WON'T be able to get a Pass that will provide "unlimited trains, buses, cable cars etc. to get us all over" as the situation varies in each country. Many of the Swiss Passes only provide discounted (50%) rides on the Cable Cars.
One other point to note is that Railpasses are rarely cost effective for use in Italy. Keep in mind that many of the trains in Italy require compulsory reservations and these are NOT included with Railpasses. You'll have to pay "out of pocket" for the reservations. Be sure to have valid reservations on trains where these are required, or you'll likely face hefty fines, which will be collected on the spot! Also, Railpasses are not accepted by some of the rail networks in Italy such as Italo or Circumvesuviana.
It's great that you're getting an early start on the planning as it will give you time to work out all the details.
