I see what you're saying. The whole hostal concept is confusing to a lot of people who assume you're talking about youth hostels. When I was a travel agent and had clients who wanted to go to Spain inexpensively, I used to suggest these establishments, and the people would recoil in horror as though I was sending them to sleep in a barracks like they were in the army.
Sometimes even after a lot of explaining and showing them pictures of nice places in brochures, they still thought it was a student thing.
Of course, once they actually stayed in one of these hostales and paid a low rate, they were converted for life and returned to Spain repeatedly staying in hostales in every city they visited.
Obviously in this kind of conversation, I didn't dare to say hostales. It would sound too pretentious - like one of those people who drops French words into every sentence for no reason. I just used hostals as the plural not to scare them away. You know how these Americans are.