By all means try to stay in or near the French quarter. There are so many smaller B&B style places, as well as smaller hotels, with terraces and gardens that really make travelling to NOLA fun. And many of them are reasonably priced. For one visit I stayed at the Omni Royal Orleans in the Quarter (on St. Louis Street), which was beautiful and perfectly located, if a little on the expensive side - but it was small enough to not feel 'industrial' yet big enough to have an excellent staff (and a concierge who was awesome). I also stayed at the Hilton Riverside once and would NOT recommend it - its big, kind of ugly, and always full of convention-goers. Wherever you stay though, make sure to plan well ahead because hotel reservations around the big events (Mardi Gras, Jazz Fest) get booked very fast and VERY early (I know people who go for Jazz Fest and book at that time for NEXT year's Jazz Fest).
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