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Help! Torn by Santa Maria travel itinerary and hotel bookings

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Well, I posted a while back to ask how long I should wait to get an itinerary confirmation. After 5 1/2 weeks Karene at Santa Maria finally confirmed hotels at Inle. It seems there is a one-legged boat festival the days we were to be there and all the hotels were booked.

But Santa Maria was able to get rooms at the Aureum Inle for 3 out of the 4 days we planned to be there. The other 2 days are booked at Kalaw (Honey Pine Hotel) and the suggestion is that we do some trekking and visiting a Church Compound to visit the Hill Tribe children.

Here is our suggested itinerary:
Yangon - 1 day
Bagan - 2 days
Monywa - 1 day (Amarapura, Inwa)
Manadalay - 3 days (Po-win-taung, Sagaing. Mingun, Pyin oo Lwin)
Kalaw - 2 days ( Pindaya Caves, 1/2 day trek, town)
Inle - 3 days
Yangon (Golden Rock, bago enroute)

A few issues here:

1. It has been suggested on many travel forums (including this one) to avoid the Aureum chain hotels as there seems to be close ties to the government. But apparently we are "very lucky" (SM quote) to get a place. I don't feel right about staying here, although someone wrote that staying in a large hotel like this (employing 100s of locals) is good for the people as well. Should I accept this hotel booking or not? If we don't we may have to totally revamp our tour and lose many other hotel bookings that apparently were hard to get (according to SM)

2. Instead of 3 nights in Kalaw (which they first added because we could not stay at Inle during the festival but we protested) , we have 2, and so they added a night and day trip to Pyin Oo Lwin. IS it really worth a day trip from Mandalay? It was not on our original itinerary wishlist.

3. The total price for the tour has gone up substantially. Can anyone give me a ball park figure of costs for a 2 week trip including transfers, flights, staying at mid-range hotels, and daily guides and entrance fees to sites. I thought 2 weeks in Myanmar was within our budget ($1500 pp) but this has gone waaaayyyy over.

I am an experienced traveller and organized a 4 month trip to China on our own a few years ago. I know how to work an itinerary and book hotels/transfers/tours, but this experience with Santa Maria travel has left me frustrated. While I had read that it is better to book hotels, flights etc through a Myanmar travel agency, I wonder if I should have booked accommodation on my own.

Any insight would be great! I have to make a decision about our final itinerary asap.
Thanks all!

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