any updates to the recommended accommodation here, available January through March.
We were there in late September 2008. Rick's favorite place was fully booked - as it turned out, by a Rick Steves tour. We stayed at the big box hotel in town, and it was fine - nothing special, but not bad some of the tour folks were staying there, too). It was raining cats and dogs while we were there (felt like a hurricane) so it didn't really matter to us - we just wanted to stay dry.
I found that if you wanted to book your room in advance of your arrival, those two places (Rick's favorite - Pension Mar?, and the big box hotel) were really the only places that you could book. There were probably rooms in private homes (he suggests these in his book) but I wanted to know that our room would be waiting for us when we got there.
If you're going January - March, I suspect room availability should not be challenging (although I'd make sure the places were open).
The hotel that Rick recommends is The Mare Salema, Portugal
It's a wonderful place to stay!