Budget Travel - Booking hotel night of?

I am headed to London for a week, my flight is booked but my housing is up in the air. I was going to stay with a friend, but I'd rather not put them out.

Is it really possible to get great deals simply by floating from hotel to hotel taking up empty rooms? Does Priceline take into account that you are bidding on rooms at 6pm for that night? Have you ever walked into a hotel, known there were empty rooms and simply made a manager an offer of X $?

Thanks!
M

While there are plenty of online options, I don't think simply turning up at the hotel will get you a great deal. Hotwire does indeed offer same night bookings. Better, is laterooms.com. Anybody with experience otherwise?