Russia is a bit of a nightmare to travel to.
As it has been said, you need a visa, and in order to get a visa, you need a letter of invitation from a Russian company. This reduces your options!!
When I went I used Intourist who are the old Russian communist Travel / Toursit department. They sorted out all the visa's and they can provide a Letter of Invitation as well.
When I went I stayed at Oktyabrskaya Hotel, it was functionaly rather than luxurious!!
I also use the following website to check out hotels:-
http://www.tripadvisor.co.uk
You have to read between the lines when people review hotels, because they generally only make comments if they have had a bad time!!