My girlfriend and I just recently got back form a couple of weeks in Spain and I am slowly getting around to posting our reviews of the hotels we stayed in...

In Granada, we stayed at the Casa Morisca. http://www.hotelcasamorisca.com/e_index.html
I would recommend it without hesitation. We paid about $100 per night for their basic room, but it was well worth it. Excellent location, superb views, wonderful rooms, and great service in a historic building that has been recently remodeled. I would strongly recommend it as an alternative to the more toursity up-scale hotels (e.g., Washington Irvin is one that comes to mind). If you're looking for a nice place to stay in this price range, you will not be disapointed as the Casa Morisca oozes history and enchantment.

Hope this helps

Hey thanks SFOHoya! That places sounds and LOOKS great! Did you stay in one of bedrooms featured/shown on their website? I also see some important/useful information therein: AC AND internection connection?! That's GREAT!! BOTH a necessity these days.

Saludos, MadridMan
(hope you don't mind, I changed the URL you posted above to the English version)