I highly recommend the Villa Pondicherry. Previously in Pondy I stayed at the Executive Inn and the Hotel Suruguru. Both are excellent in their own right, but neither compare in ambience to the Villa Pondicherry.
On arrival I was greeted my the housekeeper and shown a room on the ground floor, just off the dining area. The room was comfortably furnished with chair, bed and table you would expect to find in a home.
I was given a padlock for the room and a key to the front door.
Throughout the house are paintings by the proprietor, Prichaya Manet (a very fitting surname).
The following morning I sat around the table with Pichaya and the other guests (teacher from France, retired couple from Switzerland, aid workers from Belgique). Though most of the conversation was in French, it was a wonderful way to spend the morning. The highlight is when the Swiss couple sang a Canadian song (in French), a capella
I found Villa Pondicherry in the Lonely Planet Guide, but the map of Pondicherry shows it closer to town then it actually is. The map indicates that it is 60m down Ambedkar Salai, but it is closer to 600, past the Sports Complex and across the railroad tracks. Most autorickshaw drivers will know where it is.
Shawn