I have been going to Pismo my whole life and drove past the Cottage Inn by the Sea many times wondering what it's all about. We were impressed. We were located on the bottom floor (Room 513) with an Ocean view and a door to the back porch with chairs. Here are my thoughts:
Rooms- Having an Ocean view is the way to go. There are two types of ocean view rooms. The rooms upstairs have a better view but no porch/balcony. The rooms downstairs have a porch and a view of the ocean (when we go back, we will make sure to be downstairs again).
Fireplace- Our room had a fireplace which is a must have!
Free Breakfast- The breakfast was really good for a continental. They had waffles, scones, bagels, cereal, oatmeal, and more to eat.
Towels for pool/hot tub/beach- There are white and green towels in your room. The green towels are for your use at either the pool, tub, or beach.
Beds- This is hard to evaluate because everyone has different preferences. We slept decent but I find it hard to get restful sleep when I'm in new places. The sheets we nice and pillows soft.
Internet- We were never able to connect to their free internet. That was ok for the purpose of this trip as we spent most of our time away but this would have been a problem if it were a business trip.
Dogs- Throughout our stay, we noticed most of the people had dogs. I'm not sure if dogs can stay with people in the rooms or if there is a special place for them but this could be an issue for guests. I'm not a dog person my self but this never bothered me (partly because there were not many people staying there during this time of year). However, I could see this really being an issue for many people. I MUST say, our room did not smell like dogs at all. If it did, that would have ruined the trip, but it didn't and we really enjoyed out time.
To sum it up, I would stay here again, especially during this time of year (December).