I find the Hotel St Sulpice to be one of the best hotels I've every stayed in while in montreal.
I don't consider it a "pooning" hotel.
Last time I checked in was one of the top 10 hotels in Montreal on tripadvisor. The fireplace in the suites are electric, and the location is on the same block as Notre Dame Cathedral.
BUT I think they had to relocate their Gym and Sauna, as they were located in the building next door which was sold earlier this year. When I was last there this summer (2010) they offered the use of a Guy a few blocks away. Not sure if that has since changed.
Parking is a bit expensive if you use the hotel's valet but you can also park down by the water area where the old docks are, where those museums are for pretty cheap and it's only about 3 block walk from the hotel.
It's also pretty close to Palace de Congress, and Chinatown.