I had a wonderful stay a couple years ago at the Peninsula. The price was great (although I'm sure prices will skyrocket during the Olympics) - at the time $215/night for a lovely room on the club floor, where you have a private breakfast buffet, excellent concierge service, cocktail hour, food round the clock, etc. The rooms are great and the hotel is in an excellent location to walk to the main shopping area and (for a more adventurous walk) to the Forbidden City, Tiananmen Square and even farther south through the hutong district. You are also very close to Beihei park and the lakes districts. I must say I don't think the service in mainland Chinese cities lives up to that of 5 star hotels in other countries (especially Asian) but as it is across the board I would say the Peninsula is a very good choice in Beijing.
I've also heard good things about the St. Regis and the Grand Hyatt although I don't think their locations can compare.
"THE" top hotel these days is the Hyatt at Tiananmen Square. I quite liked it. Very nice staff. It caters to business so service is fantastic. Great hotel waiting area, bar etc. I think they have arrangements for people that want to do a 6 mile jog around Tiananmen Square. Had i not had jetlag, I would totally have done this.
I think LL Is still working on it's China selections. Try this website www.ctrip.com. Their rating system is fairly accurate. They are also great for booking last minute regional flights throughout China as well.