Candlewood is farther out from the downtown area, but the area it is in is very nice. It's Fitchburg, which has seen expansive growth recently, so most everything in the area is much newer. Right around the hotel is a nice plaza with quite a few shops and the Great Dane Brewpub. Once you get out of the immediate area of the hotel, though, it's not very pedestrian friendly. Most of Madison's outlying areas aren't.
Inn on the Park is the most expensive. You're paying for location, there. Close to everything, including at least two of the local microbreweries. The option here, is maybe looking for outside venues for prom?
InnTowner is my favorite, but only because I'm very familiar with the area. I lived within blocks of it for two years and could walk to all my favorite places and school. I was in great shape. :) Don't forget, they offer a complimentary shuttle service. Also, one of the campus bus routes runs right by it. It will at least get you to the Memorial Union (a fun place in and of itself), which is at one end of State Street. The bus is free and it runs between the hours of 6:00am and 12:45am. If you stay somewhere until bar close, you'll have to cab/walk.
The Marriott is very nice, too. They have a seven story waterfall in the lobby. My last company held their Christmas parties there for a number of years. Again, not close to downtown, but a hop-skip-step from Greenway Station which is chock full of expensive shops and restaurants. Starbucks! The only hotel close to a Starbucks. Again, once out of the immediate area, not super pedestrian friendly. But one of the breweries is in moderate walking distance, along with more shops.
The Crowne Plaza, while not too shabby, is on the east side which is much less economically advantaged, shall we say? (I should know, I grew up there.) It's across the street (and by street, I mean a 6-lane major artery on the way out of town) from East Towne Mall, but there aren't a lot of high class restaurants, bars or interesting things to see. We're talking Olive Garden and Chili's. Again, very pedestrian unfriendly.