When on a pilgrimage trip , my choice of accommodation would generally swing towards a hotel offering proximity to the temple , cleanliness & reliability over amenities, comfort & cuisine . If you agree with me on this , opt for New Tirupur Lodge when in Palani.
The place is great value for money and has the advantage of excellent support staff who are ready to help you round the clock . The place is relatively clean given the churn of devotees and run a 24 check out format . Their restaurant Nalapakkam has a decent choice of south indian dishes and the food is definitely worth the money you pay .
The only drawback is you are surrounded by touts who claim to have an insider who can get you into the temple and out in a flash . Dont fall for them ! . My suggestion is that you either walk up the hills or take a winch and opt for the 100 rupee ticket at the main counter . This makes your trip less cumbersome and you can cut through some traffic