You're a Devil, CaliBasco! Hahahaha...
(but seriously, I always recommend Hostal Chelo for budget-minded travelers)

Basil, too bad there aren't any Paradors in Madrid but this might be a good option if you'd like a 1 or 2-night getaway to nearby Toledo or Chinchon .

While I've NEVER read/heard any feedback on them, there are few quaint B & Bs which are listed @ http://www.MadridBandB.com . The photos certainly look nice and quite elegant too.

Also consider some of the hotels using Bancotel checks. The hotels tend to be nicer (don't they??) and at a discounted rate when using these checks.

Good luck and please keep us posted. Saludos, MadridMan