Hi
duffshot
can offer a little, spent 2 days and nights there about 5 years ago. Hotel Carlton as I recall which was reasonably priced (or I wouldn't have stayed there!), and had nice, spacious (for Europe), and modern rooms. Not so sure the meals are good value though, probably want to eat away from hotel. It is located abt 5 mins walk from Atocha railway station, and 10 - 15 mins walk from Prado museum (though IIRC this and other museums tend to be closed on Mondays for some reason). Also near Prado museum is a stop for the Hop-on Hop-off bus, which covers a reasonably generous portion of the city and was fairly priced.
Anyway, the Carlton is one of hundreds, so for reviews on many Madrid hotels follow this link and type madrid hotels in the search function field
www.tripadvisor.com
Oh, and 2 essential phrases in Spain - cerveza fria (cold beer) and vino tinto (red wine)
Cheers