A friend and I travelled around Spain for a few weeks in August. We stayed at Hostal Meridiano in Granada. http://www.hostalmeridiano.com
Calle Angulo, 9, Granada Phone/Fax 958 250 544

I don't have enough positive things to say about this place. The staff was really helpful & friendly, the rooms are clean & quiet, there is internet access, the hostal is centrally located (close to the Albacin and within walking distance of everything). AND... it was inexpensive.