I go every year to Gran Canaria in March (this year in May was my 7th trip). So when asked to give some advice about flights or accommodations there I wrote the following:
The pics show me naked out in the Maspalomas Dunes, which can be reached on foot from the Playa del Ingles beach or by walking back from the shoreline toward central Playa del Ingles (town). The major gay nightlife is usually found in and around the Yumbo Center, a large 4-story shopping complex, with numerous restaurants, souvenirs shops, fashion stores, etc. It becomes the local gay mecca sometimes after 11pm each night and is active until 3-4am. There are also sex clubs located within the Yumbo, mostly on the ground floor level, mixed in with the gay bars, several which have drag shows and strip shows.
You can sometimes find good bargains for flights and hotels to Gran Canaria on the major travel booking sites, but not always the most popular ones, like Orbitz, Yahoo Travel, or Expedia.
Instead take at look at:
http://www.alpharooms.com
http://www.booking.com
Alpharooms also has flights with hotel stay plans that can be quite cheap, although I have found it usually cheaper to book them separately. But it is worth checking out if you are coming from a major European city. Koka: The place that has been fairly nice (a small studio apt with kitchen and balcony or direct access to the pool), it's cheap (in March usually $30-$40 a night) and also not too far from the beach or to the Yumbo (gay nightlife) is:
Apartamentos Koka,
Avenida de Tenerife, 17 35100 Playa del Inglés, Gran Canaria, Las Palmas, Palmas, Spain Tel 928 76 16 17
(I just checked these sites for possible booking for next March, the Koka is already fully booked. So you may find the same is true for your stay).
However, there are dozens of similar apartamentos hotels, like the Koka, some with room and board plans. In fact, some may be closer to where you want to be. I suggest staying with walking distance of the Yumbo Center since you'll inevitably end of there late at night (there are taxis, of course) to more outlying areas (which are nicer and more expensive).
It all depends on what you want or need out your vacation.
I prefer to stay cheaply since I am usually not in the room at all except to sleep and sometimes cook my own meals. There are plenty of restaurants, of course. But the typical place in Gran Canaria has only the basic food (rather unhealthy too). So I prefer to save my money for splurging on gourmet meals in other larger cities in Spain and elsewhere in Europe.
Note too that there is a city bus from the airport (LPA) that runs through Playa del Ingles and onward to the Lighthouse tower near the beach in the actual town of Maspalomas.
In the two cities blend together and even the locals confuse the two locales. It's better to know the street names and have a map or the address of the hotel before you arrive.
I got off at the wrong place once and had a long walk with a suitcase before I found it (or a taxi).
P.S. There are a few exclusively gay hotels, but I prefer the 'straight' ones -- just because the services are the same but the clientele is not. Gay men can be snobby and even act condescending (especially some gay couples on vacation). At least the straight people will either be friendly or just plain ignore you. Besides, you have to pay premium prices for gay hotel (clothing optional or not). You're just as well off to be naked on the beach and in the dunes all day and then stay clothed at your place of accommodation.
The Basement Studios is a gay hotel, but they also allow day and evening guest from outside, especially for their Wed night sex party. The Cellar (gay nude bar) is open nightly from 10:30 ish until late.
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