There are tons of cave hotels in Goreme. Some of them are very cave-like, others look like a room that has been rough stucco'd. The Local Cave Hotel is more of the later. That's not to say that it's not a real cave. It is, it just looks a little less "Flintstone" than you might be expecting.
The rooms are large, so if you're claustrophobic, there's nothing to worry about, and the rooms have a window next to the door. (Hey, don't laugh, some of us don't like the concept of small confined spaces.) The bathrooms, like many in Turkey, have an open shower and no tub (this means the room is fully tiled and there's a drain on the floor with a handheld shower fixture).
The hotel has a swimming pool, which I can see would be a great advantage in the summer heat. The pool wasn't filled when we were there as it was too early in the season and the weather had been mostly cool/cold before we got there.
Breakfast is included and is the typical Turkish breakfast (cheese, tomatoes, cucumber, hard boiled eggs, bread, butter honey/jam).
The hotel is one of the most conveniently located in Goreme. It's a block from the downtown area rather than far up one of the steep hills. It's also walking distance (1km) to the Goreme Open Air Museum so you can explore it on your own without booking a tour or getting a taxi.
The Local Cave Hotel also owns the Local Restaurant which is one of the two best restaurants in town and has a great selection of interesting mezes and creative entrees.
The best thing about the Local Cave Hotel is the staff. They are helpful and informative without pressuring you to buy tours. And they are extremely accomodating. On our last day we checked out of the hotel and then spent the day out on a tour of the Ilhara Valley. We were hot and sweaty and about to get on a night bus to the coast. We asked if we could use a shower somewhere and they were nice enough to accomodate us.
I'd highly recommend the Local Cave Hotel.
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