Visited in 2006 and we had a great stay. Good food, good personnel
We had a room with street view and we had no problem. The greatest pool from the area.

The Kresten Palace has a luxurious lobby and beautiful grounds, for that it deserves its four-star rating. However, the rooms are more like two/three stars. The doors feel flimsy and insecure. If you're getting a bargain deal on this hotel like we did, you're probably in one of the street facing rooms that was not renovated when the rest of the hotel was. You can hear the noise from the bar downstairs. The carpets are disgusting. It's very worth the 6 Euro per day to upgrade to an ocean view room--most of these have marble bathrooms and tile floors it seems.
The minibars are empty, but that's no big deal. You can buy from the downstairs shop at a reasonable price. But we were there on May 30, one day before "high season" and they refused to use the air conditioning in the rooms. It was quite hot and uncomfortable to sleep, and we are people who like it hot.
Most notably the service was problematic. The hotel staff was not accomodating and always urging us to leave the dining room so that they could go home. It was like pulling teeth to get the front desk to move us to an appropriate room--even when we were paying for the upgrade! Not four-star service.
We had breakfast included which was fine, but much of the food was canned--a few fresh tomatoes and citrus. We ate dinner there once, but you're much better off going to the local tavernas nearby (Tsambikos--on the water, direction Rhodes, 1 mi.?)
People seemed to be enjoying the entertainment, but that's not our thing, so we don't know.

In brief these are the reason why I advice you not to book this Hotel:
- Hotel needs total renovation
- Rooms are shabby
-Our bathroom had a blocked sink
-There is a mini bar with no drinks in
-The a/c was not working
-The carpet in the room has three different colors, not sure what color it was originally.
-The food is disgusting and you have to queue for it
-No English channels on TV!!!!!!
-No animation

I personally would not give it more than 2 stars.

We booked it as a package tour.
The hotel was great! Good size, clean rooms, big terraces overlooking the sea, the pool area and Rhodos town as well.
The fridge in the room was very useful for us. The aircondition worked very well.
The meals was tasty and there was a big choice of cold and hot meals as well (we were on half board basis).
The staff is very helpful and polite. We asked for other rooms, since the rooms given for us were dark on the ground floor of a windy side building and it was really a 12 minutes walking distance (walk, scales, elevators) to the reception and the hotel restaurant. The panorama was also awful from here.
So we changed rooms, and we received bigger, lighter rooms with amazing panorama over the sea and Rhodos town.
The area is very quiet, despite the animation it is silent at night, since the organised programs end between 23 and 23.30.
The hotel beach is a small rocky beach, but wonderful for diving and swimming. It was never crowded in June!
The bus stop to Rhodos town is in front of the hotel. In Kallithea centre there are a few shops and car rental offices.
All in all our vacation was excellent.