My personal habit is to have a formal lunch and tapas for dinner. This seems to be the pattern of most of the Madrileños I know.

I have found it rare to see a 'menu del dia' at a 'normal' restaursant for more than 10 or 11 euros (including wine). Try The Alhambra on c/ Victoria (the best cook in the neighborhood) or anything on c/ Ventura de la Vega, particularly Marina Ventura where they have the best rice (paella) in Madrid! My favorite is El Ingenioso on c/ Leganitos across from the Hotel Colosos. Their 'entrecot de Gallego cebon' (steak grilled at the table) is the best I have ever had and their service is great!

I cook for a living and spend 6 weeks a year in Madrid so this advice is not given lightly!

About lunch, you can find menu del dia for less of 10€ easily unless you're very downtown. In neighbourhoods (and if you really look, downtown), you can find good menus del dia for 7 or 8 euros. 9 should be even a bit too much, for someone who takes a look around before selecting bar/restaurant.

We spanish use to have dinner at home, unless we re having fun in a weekend, and then have tapas, or that it is a weekday but we make an appointment for some cañas.

There is not such thing as a menu del dia for night purposes except in Chinese restaurants, but there is "platos combinados" which is a very good alternative (a big dish with meat or fish or/and ommelette or burger, plus fried potatoes or small salad, ...) that is usually about 4,5 to 6 euros. If you want beer and a dessert, however, that'll be extra. Beer would be around 1,2 €, dessert is expensive: 2 to 3 €.

We discovered Rio de la Perla on Cava Baja (a few meanderings off Plaza Major). The food was tasty, ample, and cheap (5-6 euros). The place was clean and the service was good. We were a sizeable group (with students), so were glad to find a way to stretch $$.
Also, Ducados on C. San Jeronimo off Sol was a good value. The ambiente was trendy, but fun. and the food was reasonable and tasty. Didn't see many tourists there.

Fernando, I find funny that you talk bad about Chinese restaurants quality and then you say that you're fan of American restaurants!
Personally I'm a great fan of Chinese restaurants and there are a lot with good quality, not always that's true, but this happens also with a lot of tapas bars. I think the worst relation quality/price in Spain is in Burguer King and McDonalds, I find Foster Hollywood a bit expensive for what you get, but quality is OK for me, although I prefer to go to Alfredo's BBQ to get a good hamburger

I personally think that Casa Chica offers the best American hamburger available in Madrid! :p

You have to prove that. Slurps! :p

wHERE'S caSA chica? Is it expensive?

Since I can see no smileys in your post, miguelito, I'd like to mention that the message about "Casa Chica" was posted by "Chica", and had smileys in it.

Oh, I related chica with small instead of girl,
How short I am.

Miguelito, I wasn't including McDonald's and Burger King in the "restaurant" category

I was writting with Hollywood, Tony Roma's or Ribs in mind :p

Fernando