It's true. Announced in BA News last week. They have been thinking about it for a few years. I met some engineers there 3 years ago who were scoping the airport and facilities out. There seemed to be two issues: no ILS, but BA were willing to participate in funding one, and security and safety of crews and aeroplane on the ground and in hotels. I suppose that since the ceasefire and the death of the rebel leader the percieved threat is less. I don't expect the poor and needy of Luanda will give two hoots about that though. It's not much worse than most big european cities seedy quarters in my opinion. Although the punishment for those caught mugging expats and foreigners is.
As for where to stay: there was nowhere that I could afford to even visit, but we were accomodated in a villa in the city, near the sea front, and very pleasant it was too.