I am personally very generous and quite similar to you in friendship OP but I would also be VERY reluctant to spend 70£ for a night in an hotel room. I wouldn't spend that amount on myself to be honest.
Lots of people think I live "the good life" because I travel frequently and often live abroad and of course from the outside and looking at pictures of my trips and life it may look like this but truth is, I am not well off at all, I simply budget everything up to the last cent. Lots of my friends who travel much less than me are much better-off than me (they just decide to spend their disposable income in other things) and simply assume I can afford much more than I can despite me trying to explain that I can't.
You may assume your friend has much more disposable money than she does. She is SAHM, she has two houses (that probably generate costs), she has children (to feed, dress and entertain) and a husband. You may earn less than her husband but once your rent/mortage and bills are paid you are only having to provide for one person, which may leave you much better off than your friend who is having to provide for 3 or more and like people have said, since she isn't working, she may not even be able to call the shots on this one.
I can see both side of the story to be honest. One of my closest friend is (better off than me) much less careful with money than I am and often likes for us to go on a crazy adventures, (she is Aussie and living in Oz and I am not so evertyhing we do often already involves traveling) except she never really budget. I don't see her that often so I often cave in because I do love her and want to see her which mean that I often end up spending much more than I feel comfortable spending. Last year for her birthday she texted me to say "we were going to Ibiza" as the flights were cheap and indeed they were, except she hadn't looked at accomodations and the prices were excrutiatingly high. This little weekend-away ended up costing me over 500€ which is much more than I would have ever been comfortable spending on a trip that lasted such a short time! The year before that it was a ski trip to NZ that ended up costing me thousands.
If I ever suggest that I may not be able to afford it, she gets slightly offended as if I don't value our friendship enough to spend that amount of money on spending time with her. It's true that she has spent a lot of money on me in the past. (If she really wants to do something and I really can't afford it then she'll pay half or will just pay for it) so I know that she really wants to spend time with me and is a very good friend but she doesn't always understand that me not being able to afford to do something with her doesn't mean that I don't value her or our friendship.
I don't have as much money as her so obviously I don't do expensive surprise gift and stuff like that like she can do but when she needs me, I am there. I have also moved to Oz for her for a year when she was going through a rough patch. I do value our friendship and it does hurt me and annoy me when she insinuates that I don't simply because I can't afford to do something she wants to do.
OP, is your friend there for you when you need her to be? Does she provide you the support and listening ear you need when going through a tough patch? if she does, then I wouldn't be upset at her for the hotel room. She obviously wants to join in on the party and be there for you on your birthday but she is also being honest about her financial situation. It doesn't mean "she doesn't like you enough to spend 70£ on you", just that she can't currently spend 70£ on an hotel room.
My friend likes to suggest those very expensive trip or outings for her birthday and I always feel obliged to say yes, as I don't want to force her to change her plans or have her do something she doesn't really want to do on her birthday but it is a pain in the arse because if I didn't go I would feel like a shitty friend as she is my closest friend but if I go, I am often in debts for a while afterwards as it always gets outside my budget. So yes, talk to her and figure something out. At the end of the day her attending (even if on a budget) is more important than her not coming at all, right?