Accomodation - Stay at Bhuj was just okay and we preferred not to spend much since only wanted to keep the bags. You will get good options through booking.com , airbnb, etc.
Food - You will get traditional food at all places. Anando restaurant, near the lake is a famous one. Another small dhaba/hotel(forgot the name) just on the opposite road of Anando is equally good one. The foods are really good, try out the special mirch and lassi.