Santa Cruz [1] proper has only a handful of accommodations; at the budget end, Hotel Alcázar (Besoain 285, tel./fax 072/822465, US$15 pp with shared bath and breakfast, US$25/38 s/d with private bath) is mediocre at best; some singles are truly claustrophobic.
Far better is Hostal Santa Cruz (Carvacho 40, tel. 072/822046, hostalsantacruz [at] terra [dot] cl, US$17 pp); though the private baths look like an improvisation, the 2nd-floor rooms themselves are spacious and comfortable, and the management is friendly. Its big drawback is the busy street, but it quiets at night.
Cardoen’s 
Hotel Santa Cruz Plaza (Plaza de Armas 286, tel. 072/821010, fax 072/823445, www.hotelsantacruzplaza.cl [2], US$165/195 s/d), though, sets the standards for accommodations in Santa Cruz and, arguably, throughout the region. While some of his activities may have been questionable, his taste is impeccable and the hotel and its restaurants show it.
Beneath a fine grape arbor, the Club Social de Santa Cruz (Plaza de Armas 178, tel. 072/822529) is a traditional dining favorite for winery tours. It’s lagging well behind the two restaurants and poolside pizzeria at Cardoen’s hotel, though, which are not expensive for what they are.
Sushi Plaza Santa Cruz (General del Canto 5, tel. 072/822059) is neither cheap nor up to Santiago sushi standards, but it’s popular with local winemakers looking for some variety in their diet.
Links:
[1] http://www.moon.com/destinations/chile/chilean-heartland/-southern-heartland/santa-cruz
[2] http://www.hotelsantacruzplaza.cl