Not close to WEM, but both the Metterra (Whyte Ave) and the Matrix (downtown) are nice hotels that are a little more interesting than a standard hotel room. Rates were good at both the last time I was at each.
The last time I stayed at the Fantasyland Hotel was back in the early 90s when I was a young whippersnapper. Seemed pretty cool at the time, but by the sound of some of the comments, it may not have changed much since then. And what was cool in 1991 to a 12-year-old may not leave the same impression these days.