We just got back from Caribe Blu hotel last night after staying there a week from May 17-24, 2008. We found this hotel/scuba/restaurant combination to be very convenient for our vacation preferences. The fact that you can get up late, walk next door to the dive shop to check in, go upstairs to the nice and casual restaurant for a good, inexpensive breakfast was great for people who work hard all year and don't want to have to work hard on vacation.
The pool is clean and refreshing, the dive operation is friendly and professional, the restaurant food is good and nice to have so close when you come back from a dive hungry at 12:30 and want to eat right away.
The one problem, and it's a big one, is noise from cars on the road right in front of the hotel at all hours of the day and night. Even with the air conditioner on full-blast, and wearing earplugs at night, my wife could not get a good night's sleep for 3 days. We finally had the bright idea to move to a room on the first floor, which has a cinderblock wall between the rooms and the road, for the last two nights of our stay. With the AC on medium speed, we did not need earplugs and were finally able to sleep through the night without hearing the horrendous road noise.
In summary, if you are not a heavy sleeper, and cannot get a room on the first floor (there are only 4 of them), you need better earplugs than we had to sleep here. Otherwise, the place is great for scuba divers on a dive vacation who want convenience and comfort out of the congested downtown region, but not so far away as to feel isolated. The walk to downtown restaurants is about 1.5 miles, which is pretty far in the heat and humidity, especially after a day of diving and not enough sleep. But the taxis are easy to flag down and cost $4 for a one-way ride to town, in which there are many good restaurants to choose for dinner.

Caribe Blu is my proverbial home away from home. My dad discovered this gem in 1981 (it was La Perla then), and my family has been staying there at least once a year ever since. We love the size (very small), the slightly rustic atmosphere, the location (close enough to town to walk or for a cheap cab ride, but far enough away so the the cruise ship crowds aren't a factor), the personal attention given by the personable and competent staff, and the convenience of the onsite dive op (Blue Angel), boat dock, and restaurant.

The rooms are clean and spacious, the beds are comfortable, the pool is well maintained, and the unobscured sunset views from the patio and balconies are stunning. The rooms have televisions (we never turn ours on) and telephones, and most (possibly all by now) have mini-fridges.

I wouldn't consider staying anywhere else on Cozumel.

My wife and I just returned from our third stay at Caribe Blu (we previously visited in Nov 06 and May 07). Upon arrival we found that many of the friendly staff members were still there and we were greeted very warmly.

This is a great destination for scuba divers that provides convenience to an excellent dive operation. The rooms are austere but are large and functional. Each room now includes a small refrigerator and a TV with about a dozen English channels including CNN Headline News. All rooms have patios or balconies overlooking the water. Good snorkeling is available in front of the dive shop.

We dove six days with Blue Angel, the dive shop affiliated with the hotel. Each morning we boarded a small boat with a total of 6 to 8 divers. The boats are very fast and we quickly reached the dive sites. The surface interval was often done at a pier. Dive masters accompanied each dive and they are very competent and very safety conscious. Boat captains did a great job of following our drift dives and we had very short waits for pickup at the conclusion of the dives.

We generally returned to the hotel about 12:30, rinsed gear, then cleaned up a bit for lunch. The small restaurant above the dive shop serves freshly prepared and tasty lunch fare like club sandwiches and burritos. Many of the divers congregated at the pool after lunch and it was interesting to share stories with divers from different parts of the country.

We were part of a loosely organized group from San Jose that included some nondiving spouses. I was initially concerned that the nondivers would be bored but they enjoyed walks into town to explore and to get exercise.

A few of the other reviewers have commented on street noise. We found that closing the bathroom door reduced the noise level and helped to keep the room cooler during the day.

This hotel should satisfy anyone going in with the proper expectations. This is not a luxury resort. But it provides a large clean oceanfront hotel room with a balcony and refrigerator for less than $100 per night.

I know I may not be popular by saying this, but I picked this hotel based on what people here were saying. I didn't like this place at all and we checked out after a couple of days. It is SO noisy that I didn't sleep a good night's sleep for the entire stay. We dove with Blue Angel. They were OK but nothing special. Once again most of what I read online was a bunch of hype. It may be good for people who can't afford a nicer dive resort, but I will never return.