I stayed at a bed and breakfast place called Otta's house. It was cheap and nice. Otta is some guy who lives in a big house and the breakfast is pretty much toast and jam. Not sure of the contact info, but we got it out of the Let's go Europe book. It's a little out of the way though if you are in a hurry.
Prague was my favorite city in a five week tour of Europe on the rail. It has beautiful old architecture and castles, it is very inexpensive, and it is very friendly. I'd try to stay longer if it is possible.
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