Airtran flies direct from Orlando, so that's another option. We typically drive from Orlando (about 6 1/2 - 7 hours), but have flown a few times and love the view of the islands from the air. Personally, I would do however it comes out cheaper for you, but if you're only saving a little by flying into somewhere else, renting a car and driving the rest of the way, I'd opt to fly directly into Key West. It's worth it for the convenience factor alone.
If you're staying at Sunset Harbor, you will not need a car unless you're planning to visit any of the other Keys. Even then, it may be cheaper to only rent a car for the day or so you'll need it. There is a charge to park at Sunset Harbor, but not at Hyatt Windward Pointe or Hyatt Beach House. Those other two are not in old town and are not nearly as conveniently located, so you'll need some sort of transportation to get around or take taxis. Renting bikes or scooters are a great option and there are plenty of free bike racks and scooter parking spots in old town -- much easier than finding free parking for a car there.