The Third Ward is a warehouse district just south of downtown, but for all practical purposes is downtown.
Many of the buildings have been converted into retail, restaurants, bars, and condos.
If you check on google maps, it is generally the area south of St Paul Av to E Erie St, east of the Milwaukee River to the lake (including the Summerfest grounds).
Most of the activity is on Water St and Broadway St (and to a much lesser extent Milwaukee St) between St Paul Av and Erie St.
I think the suggestion of the Hilton Garden Inn Downtown Milwaukee is right on. It is in a beautiful old building, and the hotel itself is brand new. I'd get a room facing E Michigan St, because you will get a view of one or two of the most beautiful old buildings in downtown Milwaukee. Check google street view and see if you don't agree. You can input the address of 211 E Michigan St.
There are reviews of the Third Ward here on Tripadvisor.
Here is the Third Ward website: