There's a historic boutique called Sorrento Hotel near Capitol Hill and it's gorgeous. There's a big fireside room where they mix classic cocktails and bring out great appetizers and the rooms are small, but in dark wood panel and very cozy. The staff is fantastic -- I lost my Moleskin notebook on the trip to the hotel and they heard me talking about it and there was a new one waiting in my room when I got back the next day. They also heard my roommate say she was having a tough day with work and they brought us a shaker full of two martinis and asked if that helped. In short, I'd say this hotel is fantastic because of their attention to detail and old school style, but it's also close to a lot of Capitol Hill stuff like Elliott Bay Book Company and not too fara walk from the downtown area, Seattle Public Library - Central Library, Pike Place Market etc.
Check out the W Hotel Seattle or Hotel Max if you want something trendy, a Seattle music inspired hotel. Hotel Max has small rooms so you would want a suite. If you like wandering around shops head up to Broadway on Capitol Hill Neighborhood or catch a cab to Ballard Neighborhood.
Answering my own question here: We ended up spending a couple nights in the Seattle at Hotel 1000 and we found it to be just okay. I was hoping for something a little more "splurgy" and from what I could tell it looked like one of the nicer places in Seattle. We got an upgraded water view room which had a slight water view looking down the street but from what I could tell this property doesn't have any unobstructed views. The bathroom had a tub filler coming out of the ceiling which is a novelty you don't see in many hotels, but we weren't too impressed.
When we were shopping, we narrowed it down to Hotel 1000 and the Four Seasons Hotel Seattle and chose the Hotel 1000 because it was about $100 cheaper per night so we felt good about saving some money. But tbh after seeing the Four Seasons and it's locaton, lobby, and newer construction, i think it would have been worth the extra money for a splurge trip like this.
The Four Seasons Hotel Seattle is pretty tough to beat.