There are lots of hotels in Killarney which are walking distance to all the restaurants and bars in Killarney. There are also some beautiful hotels a quick 10 min drive away which look onto the lake. When we were there, we stayed at the beautiful Ballyseede Castle (30 min outside Killarney in Tralee) and we also stayed at Cahernane House (I love old school hotels and castles). We also looked at the Brehon and The Lake Hotel Killarney which look beautiful too.