It's more economical to rent an apartment from VRBO/AirBnB/Interhome than a hotel. We typically pay $150-$200/night for a very nice apartment with kitchen and great views, while decent hotels in the area can run $350-$500 and then you have to eat out every meal, which gets expensive.
Neither is a city; they are tiny villages. There are few hotels in either, so it is quite manageable to look at all of them. Search booking.com to see what falls within your price range - most rooms are considerably cheaper than the prices mentioned above.
Thank you for your input.