There are a lot of things to do in Key West that don't cost a dime and would be great suggestions for an itinerary for your guests, if you go to the Key West Chamber of Commerce they have a community events & festivals page where you can select the month of May to see an expanded month view of every event going on down here.
If you are leaving it up to your guests to find their own accomodations, my best suggestion is have them contact the Key West Innkeepers to find them the best prices and locations for them to stay within close proximity of your ceremony and reception.
Another alternative to the Rum Barrel could be the Conch Republic Seafood Company (restaraunt) located right on the water at the Historic Seaport, just one block over from the Rum Barrel. It is a very laid back venue with a nice set up for you and your guests.