I found Prague to be much cheaper (and cleaner) than Budapest, which has a similar layout and similar sights (castle on the hill, river through town, famous bridge).

We stayed at Julian hotel (#12 on tripadvisor), a short walk from the Charles bridge. Very good price, service, and lobby. My only issue was the hard beds, but that's true in most European and Asian hotels.

You'll like the food if you're a meat and potato kind of person. I enjoyed pickled emelin in particular (a kind of camembert). The beer is of course exceptional.