One of the highlights of our 2-week trip thru Switzerland, Austria, Germany, and the Czech Republic was our stay in the Lauterbrunnen Valley. There is nothing like this valley for the views, the people, and hikes. I've stayed in Interlaken, and have visited Luzerne, and there is no comparison, this is the place to be. The cable-cars to the Schilthorn, Gimmelwald, and Murren are right there, along with a small railroad that runs across the cliffs. There is easy bus service that will take you from one end of the valley to the next, or hike one of the many trails, novice to expert, sprinkled throughout the area.
The Hotel Staubbach is situated right in the middle of everything. They are reasonably priced, with a friendly staff that are willing to help with any questions you may have. The rooms are more than adequate, with comfortable beds and surprisingly large bathrooms. Every room has a patio or deck to relax on after a hard day of hiking or morning coffee.
All-in-all a great place to visit, and a great hotel.