Hi Mike! There are many nice towns surround Madrid and within an hour by public transportation. How about Alcalá de Henares? This place is popular with nearly everyone and busses go to/from Madrid constantly as well as the train. They have a wonderful Plaza Mayor too where you're likely to strike up conversations with others sitting on the benches.
As for your being into "the bar scene", keep in mind that "the bar scene" is not like "the bar scene" in the US or other places in the world. Bars in Spain is where families go for dinner, drinks, and conversations. Bars ARE where most Spaniards meet to talk for hours and they may only consume one beer the entire time. Bars are busy all afternoon and until closing time.
I'm sure you'll get MANY other suggestions as to where to stay for your 7 days in the Madrid area. There are PLENTY!! I'd suggest Chinchon too, but it's not as easy to travel between the two - by bus only I believe, but not a city bus like from/to Alcalá de Henares.
Saludos, MadridMan
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