DvrRick,
As far as I know there are no decent hotels outside the hotel area, with the exception of the Renaissance, which is located in Oranjestad. The island is small so there is no need to stay near a dive shop or a particular dive site.
Contrary to what Clravoie wrote, the best diving is NOT near the hotel area. The diving near the hotel area is actually the worst diving around the island. The dive shops at the hotels won’t tell you that, because they would rather take you to the Antilla and the Pedernales, which are just a few minutes away. The Antilla is a big wreck, about 400 feet, but contrary to what the dive shops say, it is not the biggest in the Caribbean. It is a good wreck dive, but is always crowded and the viz is usually not that good. The Pedernales on the other hand, is something you should skip all together.
The diving at the South Coast is much better than around the hotel area. There is a long reef system along the South Coast of the island. One of the best dives at the South Coast is the Jane C Wreck, which is not as large as the Antilla, but always an interesting dive. The Airplanes are also located along the South Coast and are popular, but I don’t think they are make for a very interesting dive.
The best diving in Aruba is at the South Eastern tip of the island, near San Nicolas. Cabes Reef, Baby Beach Reef and Indian Head Reef are all located in this area and are superb dives. Cabes Reef is a very exciting dive and better than anything I’ve seen in Bonaire. There is a dive shop near Baby Beach called Jads that specializes in these dives. Jads comes highly recommended. Google Jads and check out their website for more details.
As for Clravoie implying that there is a lot of crime outside the hotel area: Aruba is not a dangerous island, but there is some crime, which should be expected in any community with a population as large as that of Aruba (probably around 100.000). You’ll be safe outside the hotel area, just don’t do anything stupid i.e. anything you would not do at home.
I hope you decide to do some dives in Aruba. If you dive the Antilla, Pedernales, Star Gerren and the Airplanes, I’m sure that you’ll think that the diving in Curaçao is better. However, if you dive the Jane C, Indian Head, Baby Beach and Cabes Reef, you’ll get pretty bored in Curaçao!
Anyway, I hope you do a lot of diving in both Aruba and Curaçao and have a whole lot of fun.