Time for an update on the Don Diego:
The Hotel is a simple Hostal (Hotel with few services) that had almost entirely Spanish families visting during semana Santa (Easter week). It was not crowded and very quiet during our one week stay. Our Triple Bedroom was very spacious and light, very clean and well insulated from the street noise below. The furniture was sparse and basic, but functional and not ugly; the beds of very good quality. Bathroom super clean and comfortable. There are many good dining and breakfast options in the neighborhood -- not a place for those seeking the nightlife, though. Overall, a good value for the self-sufficient tourist/family/culture lover.

The DonDiego is in the great non-tourist area of Salamanca. Streets very safe and bustling with every age of Spaniard until late. Not a trace of the crowds of grungy tourists filling GranVia. The hotel was clean and very good value. However, the walls were the thinnest I have encountered in Spain. The room window was into an inner light shaft, which meant no traffic noise, but made the room dark. We were put on a smoking floor against our preference, but there was little offensive odour.

Nearby restaurant O'Caldino was a great slice of Spanish neighbourhood life with fine seafood and good house Rioja. Not a word of English and they don't know to speak slowly for the tourists, but if you don't want to try spanish, they do have a menu in pictures.

There is a wonderful market in the centre of the block to the west, which explains why there are few food shops in the area. Best cafes are a few blocks west, below Plaza Colon on Recoletos. And the hot chocolate at San Gines is the best ever.

Day trip to Toledo on AVE train. Very clean, fast and modern. Note that the AVE has its own ticket office in Atocha station. 13.6 euros return.

Had trouble with AeroCity in both directions. 40 minutes late getting in, so OK, no car waiting, but it took several calls and lots of telephone music to get through to them. Their car did come 15 minutes after getting a reply. Unmarked MPV. Going back we were on the street 15 minutes early, waited 30 minutes, called them and were told driver had already been. Promised pickup in 10 minutes. Waited 25, then caught a cab. Cab was 20.4 euros compared to 16 with Aerocity.

A good value for Madrid but try to avoid a room near the lobby (5th floor)--it's too loud and smoky.

Gound floor entry is currently being remodled so it's a bit of a mess--lobby area on 5th floor is nice enough though staff are behind glass partition and not as friendly as in other places we stayed in Spain. We only spoke Spanish with them so not sure how much English is spoken (if that's something you need).

The neighborhood felt safe and was less crowded than much of the city but there were few bakeries/coffee shops nearby and only one restaurant. You'd want to eat in another neighborhood before coming in for the night. It's a VERY upscale shopping district but if you can afford to shop there this hotel is probably not up to your standards.

My dad and I stayed here 3 nights in late August.In common with previous reviewers,I would recommend it for location,economical price,basic but very acceptable rooms, good bathrooms,pleasant and efficient staff.While we were here, the entrance was being refurbished,but the hotel, which is on the 5th floor, was quiet and clean,with decent air conditioning(very necessary!).The breakfasts looked fine,but we preferred to go to the nearby "Cafe-Te" on the corner of Velazquez/Goya,which was also open late for great iced tea after a hard day's sightseeing!If the nearby metro stations hadn't been temporarily closed it would have been perfect for transport (check August closures,especially restaurants!)
Would certainly stay at the Don Diego again,it boasts a more genteel and relaxed location than the city centre hotels,but is still within easy reach of everything.