I used Hotwire last year for a 4* hotel room during a trip to London, and although the hotel was in a really nice area, it was terrible. It reminded me of my college dorm, it was that bad. When I came back from my trip, I had an e-mail from Hotwire saying that they apologized for putting me up in that hotel and that it should not have gotten a 4* rating, and they offered me a $150 credit. I actually did not get a chance to complain to them about the hotel, but I'm sure others must have, so they likely e-mailed and credited all recent guests.

This year, I used Priceline and got a great deal at the Hilton on Park Lane, and the Hilton staff even upgraded my room for free as I was staying for a week.

In my travels, here is where I would rank hotel quality:

Asia / Middle East
North America
South America
Europe
Africa
(not sure where Australia would rank as I've never visited).

I'm typing this as I'm sitting in a 5* hotel in the Far East, which is far better (room size, amenities, quality, service) than any 5* that I've stayed at in North America. The price? US$110 per night, which includes an amazing breakfast buffet.

I don't know why many European hotels have such poor quality though. Perhaps it's because all the taxes being charged don't give the hotel operators a lot of excess capital to invest, and maybe labor and materials are too expensive.