My family and I stayed here Thursday through a Saturday night, and overall it was nice. The rooms and hotel could use a bit of a modern makeover but the beds were very comfortable, and didn't have many complaints.
We stayed on the 4th floor and I would suggest requesting a room on the 5th floor or higher. Our room opened up onto a courtyard which was pretty much eye level to people standing out there. Just lacks a little privacy when you want to open the sliding glass door for a little air. There are plantation shutters but if someone's out there, they could probably listen to your conversation if they wanted.
I liked the hotel but you're definitely paying for the location here. You can walk pretty much anywhere you'd like as a tourist in Monterey. I'd probably stay here again as long as I was on a higher floor.