Hello Jeananne10!
To go to Valencia City my advice is to go by train, in my opinion the most comfortable way.
It takes 3h 20min, the price for a tourist class return ticket is about 67 euros. The train takes you from Madrid Atocha Station right to the very centre of Valencia. You have to make your reservation as soon as you can because of the great demmand especially for Christmas.
AUTO-RES buses from Madrid to Valencia are very popular. The journey takes only 4 hours, including a 20 minutes stop at a self service restaurant. The buses have air-conditioned and are very comfortable, specially if you buy a ticket for the Express bus, first class, much bigger and comfortable seats.
They have hourly services all day and night. The prices are 39.30 Normal class, 51.10 Express class go back.
Flying is not a good idea. You have to check in, the airports are out of the cities and the price is expensive. So probably the journey will take as long as going by bus but you'll have to pay much more.
If you have a car, you will take about 3h and a half more or less to cover the 350km distance. Once in Valencia you will find difficult to park your car. To move within the city you will not need the car.
Finally, accomodation. Please, what's your budget? Do you prefer to stay in a hostel or a hotel?
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Damián