There are a couple of hotels that are walking distance to the stadium...but they (of course) fill up very quickly.
Hampton Inn Downtown -
http://hamptoninn3.hilton.com/en/hotels/tennessee/hampton-inn-and-suites-knoxville-downtown-TYSHSHX/index.html
Four Points Sheraton -
http://www.starwoodhotels.com/fourpoints/property/overview/index.html?propertyID=3038&language=en_US
Holiday Inn World's Fair Site -
https://www.ihg.com/holidayinn/hotels/us/en/knoxville/tysec/hoteldetail
The Oliver -
http://www.theoliverhotel.com/
Hilton Garden Inn - University -
http://hiltongardeninn3.hilton.com/en/hotels/tennessee/hilton-garden-inn-knoxville-university-TYSKNGI/index.html
Hilton Downtown -
http://www3.hilton.com/en/hotels/tennessee/hilton-knoxville-KNXKHHF/index.html
Crowne Plaza -
http://www.crowneknox.com/
You have the Women's Basketball Hall of Fame that is nearby. Calhoun's on the River was also mentioned...or drive to the Smokey Mountains (there is actually something there besides Gatlinburg and Pigeon Forge).
There are also some excellent restaurants downtown. Unfortunately...you will be a week too late to catch ZZ Top at The Tennessee Theatre.
You can catch Darrell Scott at the Bijou Theatre the night before the game (excellent singer songwriter).
There will be a ton of stuff to do on gameday, as well.