Neither is a terrible choice, but I'd choose Lisbon. Great walking city, beautiful views from the higher neighborhoods, good restaurants, especially seafood. If you see everything you want to see on Friday, it's a quick train ride to Sintra for the day on Saturday.
I don't know that I'd call Lisbon "cheap", but compared to NYC, it definitely is!
Of course, you'll get wonderful food and coffee in Milan too, but Lisbon is still a bit of a hidden gem, as least for American tourists.