We did it the past two years with the relay option. Although the transportation for the relay portion was confusing/problematic both years, everything else about the race was great. The town is super welcoming, the kids from the school came out and cheered on all the runners, the organization in general was pretty great (including course video so you can see where you will be running before the race, even better than just a map), and the included park/party tickets were generous for the entry fees. After doing it twice in a row, I think we are taking a break this year (family wedding conflicting with our usual fall travel timeline), but I wouldn't hesitate to recommend the Hershey event.
As to where we stayed, I think the first year it was the White Rose (??) since the rate was the best, but the rate increased by last year and we picked the Rodeway Inn. Definitely not fancy, not a nice hotel by any standards, but it was close to everything, had been recently refurnished, and for just a place to stay one night, worked out fine. Don't know that it would be somewhere I would stay if I was making the weekend more into a vacation, but just to have a clean room before the run, it worked fine for us.