True, however, I wouldn't stay in Hilo, and I don't think many others would either, unless they spend a single night to see the volano
I certainly wouldn't ever recommend someone staying there as a base to explore the island. Too much is on the other side.
As for Waikiki - if there's a gem out there for under $100, I certainly haven't found it
Perhaps you're getting kaamaiana (sp) rates?
For most people, except the most budget conscious who simply MUST go to Hawaii, this article is just a bit too much on the rustic side. It doesn't have to cost $650 per day, but it also can but just a bit above the author's $170 per day and you can eat more than noodles and self-made sandwiches.
But then again, I would rather not go than go with such a strict budget.
To each his own, I guess.