Where do I take a bus (No.3 or 213) from my hostel, Sky Palace Hostel to Guilin Reed Flute Cave?

You can take public bus no.3 at Shizijie (West Jiefang Street) Bus Stop and arrive at the scenic area directly. From your hotel, you can walk northwest along West Jiefang Road around 730 yards to find the pick-up station. The return route is the same.
If you wanna take a cab directly, it costs around CNY 25 for the single trip.