Booked a $65 AU with ensuite. Originally tried to book at the Katoomba Mountain Lodge, thinking I was staying there. Instead when I arrived, the manager explained they don't have ensuite at KML but at Belgravia, not too far away, around 15-20 minute walk down Lurline St. away from the town.
Pros:
Got breaky and use of the jacuzzi, sauna and internet at La Maison hotel, next door. Much nicer atmosphere then Belgravia.
Near the 3 Sisters and a small grocery store and cafe and Swiss restaurant around 1-3 blocks away.
A nice living room lounge with a small fridge to access and a fireplace, great for families and groups.
The La Maison staff was friendly and helpful.
Manager at KML is willing to book tours for you at a discounted rate to local sightseeing venues.

Cons:
Didn't know I was going to another hotel when I arrived but the manager did give me a ride to the new place. And gave me a ride to the train station when I left since my luggage was so heavy.
There is no front desk person at Belgravia, you never see staff, the La Maison staff cleans the rooms. You have to go next door to La Maison to get any help. And La Maison's front doors shut at 8pm, so you better be inside before the front desk person leaves if you want access to their amenties.
Didn't have a hair dryer or plug for the sink drain to hand wash clothes, had to ask.
The sleeping room is tired and old feeling.
No AC but does have a heater which you need at night, even in summer.