no you dont sleep in your bed. Just pull it up on the map to fast forward time. You'll sleep on the floor somewhere. Part of the immersion is that, as a student, you don't get to sleep.
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Since Hogwarts is, well, fictional, you can't really check-in. But, the Georgian House in London has transformed some guest rooms into Wizard's Chambers. The rooms are part of the hotel's Harry Potter Tour Package.
For the most part, the house that players choose won't have much of an impact on their experience with Hogwarts Legacy. However, at one point in the story, shortly after they've learned all about Merlin Trials, players will be given a unique quest depending on which house they choose at the beginning of the game.
Visiting Azkaban in Hogwarts Legacy is only an option for players who chose a particular House at the start of the game, and it is only a very brief and linear visit, but it's still exciting to see and walk around such a storied locale, even briefly.