Mallory and I stumbled upon a great hotel in Istanbul, right next to the Blue Mosque: Hotel Sultan Hill. The building is a converted Ottoman-era house, which means that most of the rooms have windows on two sides and therefore much better light than a typical hotel room. The rooms were small but very clean and there is a beautiful roof terrace. The price was 70 Euro for a double, 50 Euro for a single, including breakfast. www.hotelsultanhill.com.
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Just got back from Istanbul Saturday. Stayed close to the Blue Mosque as well. It’s Ramadan, so gets interesting at some restaurants – you might be asked to come back after 8:30 so the folks breaking the fast (and who have reserved tables) get to eat first. If you’re still there, try walking around the hippodrome area (next to the Blue Mosque) around sunset and enjoy the crowds. Walking along Istiklal Caddesi is fun as well.
I guess Istanbul is full of those lovely little hotels. We thought Angel’s Home was great and inexpensive too (http://www.hotelangelshome.com/). Though I prefer quiet and dark rooms so I can sleep better and don’t care about windows since I am hardly there to enjoy them. The terraces are great though – there are many restaurants with great views. I guess the city wakes up in September – we didn’t notice any traffic in early August, but then again we mostly walked apart from the double decker city tour.