According to the logic of meaning, the sentence should be rewritten as:
They want to find a better place to hold 'the" party in.
"to hold the party in" 這不定式短語 (infinitive phrase) functions as adjective to modify the noun phrase "a better place".
It is equivalent to:
- a better place that we should/could hold the party in
- a better place in which we should/could hold the party
- a better place where we should/could hold the party
Therefore, the preposition "in" cannot be omitted in the above sentence.
In spoken English, people often omit the preposition, such as:
- a better place to live; a better place to travel, etc.
We could also use prepositional phrase to modify the noun in this case:
- They want to find a better place for (holding) the party.
They want to find a place to hold a party. (without preposition "in")
"to hold a party" can be interpreted to function as adverb to modify "find" as the purpose of finding a place..