Hi, we stayed in Stalis last August and passed the Cactus Hotel a number of times. It looked ok and is in a great location, very near the beach, on the main Stalis to Malia 'Beach Road', near the Malia end and only a short walk along to Malia itself. There are loads of good bars, cafes, restaurants along the Beach Road, so plenty of choice.
As you seemed to want to be near Malia, the Cactus would be a better option than staying in Herson's (although it is worth a trip to H for a alternative night out. Although it's going to cost you an extra £100, you will save a load in Taxi fares, as you will be able to easily walk along to Malia (and back) from the Cactus.
Hope this helps mate.
RayP