The area is the gateway to Inner Nikko (奥日光 Oku-Nikko). Buses from Tobu Nikko Station cost ¥1100. Buses from the shrine & temple area cost ¥950 (look for bus stop #9 on Hwy 120 just outside Nishi sando -- note that this bus stop system is separate from the bus line that circles the shrines and temples). The bus ride is about 30 minutes from Nikko -- get off at bus stop #24. Pasmo cards are accepted.
entrance fee: 520 yen to the observatory
There are hotels and ryokan surrounding Lake Chuzenji. Another easy option is to stay in Nikko (near the train station, or near the temples and shrines), and take the Tobu bus between Nikko and Chuzenji (approximately 30 minutes and 950 yen each way).