Hotels versus Hostels: Hostels (called "hostales" in Spanish), first of all, are family owned and operated budget hotels. They're cheaper, simpler, smaller, fewer furnishings, less likely to have elevators, sometimes older buildings, less likely to speak anything but Spanish, open 24-hours like hotels, get your own keys, can be noisy, can be cold in winter or hot in summer, rarely take credit cards, and... ummm..... are the preferred method of lodging of MadridMan!
As for Hotels.. well, you know what hotels are like.
As for converting the EURO, you might take a look in the "About Spain" forum for info about the EURO or just take the EURO total and deduct 10% to get the US DOLLAR$ amount at today's exchange rate.
Example: 50€ = $44.60
OR, if you have a pocket calculator, take the amount in EUROS then multiply THAT by 0.892 (or 89.2%).
Example: 50€ X 0.892 = $44.60
Enjoy your time in Madrid, Bilbao, and the rest of Spain! I invite you to visit the other forums for more information about your intended destinations.