We just got back from our first Spain trip. In Madrid we stayed at Hostal Persal...much more like a traditional hotel than hostal. Very nice lobby, reception area, cafe, elevator. The staff spoke excellent English and provided extra service (like helping with luggage, calling a cab, etc.) It's just a few blocks from Plaza Mayor and Puerto de Sol area, so all major attractions are easy walking distance. Check out the website (www.hostalpersal.com). I should mention the rooms were very simple, but very clean and pleasant with phone and tv. We paid $75 euros for two, with breakfast. From my internet searching Hostal Adriano looked very charming room-wise, but they were on the 5th floor with no elevator! I didn't hear about the hostal in the above post before our trip...also looks very nice and a good deal. Have fun!