The qualifying rounds start on Sunday, March 1st and end on the 3rd. The first rounds start on Wednesday, the 4th. The top seeds all have first round byes, so they often don't show up and start practicing until the 4th. The seeds have their first matches usually on that middle weekend, so Friday through Sunday, which is March 6th through 8th this year.
I'm explaining this because if you show up on February 26th, nobody will be there, and if you stay until only March 2nd, all you will see is some of the first round qualifying matches with players outside the top 100. None of the stars will be there or practicing yet.
That second set of dates, March 4th-9th, is the first two rounds of the tournament, and that's when you'll want to go. That's when you'll see everyone on the practice courts and maybe an upset or two in those early rounds. In terms of attendance, the first two days will be OK, but the weekend will be absolutely packed with fans.
Personally, I'm going to be there from Monday, March 2nd, through Friday, March 6th. I just have grounds passes, which I already bought. I do have a friend with tickets in Stadium 2 on Thursday, and we might swap with her depending on the scheduled lineup. (She has seats for the whole event.) My plan is to see the final qualifying matches, stargaze on the practice courts for a couple days, and then get out of there on Friday before the crowds get super crazy.
I've been to the tournament about a half dozen times since 2008, so I know my way around the grounds quite well. However, in terms of hotels, I can't help because I have always been lucky to have friends houses to stay in down there, as I do this time. Same goes with restaurants as we usually just grab fast food or eat at the house we're staying at.
My Tri-Level team has Nationals in San Diego starting on the 7th, so I'll have my racquets in Indian Wells. However, my experience has been that finding open public courts is pretty difficult. I'm planning on doing a couple practices that week with one of my teammates, but we'll probably be playing at one of the private clubs our hosts belong to. If you can't get any hits in otherwise, one fun option is to go over to the Tennis Warehouse tent. They usually have a court where you can demo racquets against a ball machine. They rotate people through every 10 minutes or so.