Casa Mexicana, downtown, is in a great location for wandering downtown, shopping, and walking to restaurants. It is a nice hotel, nice rooms, and the breakfast buffet is included. Downside is it is not really a "resort" property; the "pool" is inside and barely qualifies as a kiddie pool.
Hotel Cozumel is also nice, nice rooms, huge swimming pool, and a sandy "beach" type area across the street with access to the ocean for snorkeling. It's big, much more of a resort atmosphere. it has an AI option, which I would STRONGLY discourage - the food is TERRIBLE - UNLESS you are all dedicated drinkers and planning on getting your AI money's worth at the bar. I'd still plan on eating most meals outside the Hotel. It is outside of Downtown, but not a bad walk.
Casa Del Mar is about a mile or more south of Downtown - it's walkable, but it's a good hike. It has a pool area, is much smaller and more intimate than Hotel Cozumel, and does have suites available (check the website). Also has a smallish beach area across the street with access to the ocean for snorkeling. Rooms are not as nice, IMO, as Hotel Cozumel or Casa Mexicana, and I would definitely go with at least the Superior Rooms, ocean or pool view, rather than standard rooms. It also has an AI option, but I would pass on that and just get the Breakfast with room option. It is very convenient for diving, although I personally would not use the house dive shop - try Dive with Martin, Aldora, or any of several other operations recommended by members here. You will either need to rent a car or plan on a lot of taxi fares. If the non-divers want to go to Chankanaab Park, Punta Sur, any of the beach clubs to the south, or explore thevEast side while you are diving, a rental car would be a good option.
I've only stayed at the Fiesta Americana farther south, which is not an option as it is closed (I thought the rooms were awful - damp, musty, noisy AC - it needed the renovations). I've also never stayed in the North Hotel Zone, as it was much less convenient for diving. But there are some nice resorts with nicer beach areas up there, so if most of the group is non-diving, that may be a good option. Again, it's a hike into downtown, so plan on taxis or a rental car.