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While dining in Grand Cayman is not what many North American visitors would consider to be inexpensive, dining on a budget is entirely possible with a little open-mindedness. With most ingredients needing to be imported, costs are apt to be at least 25% more than the same items or dishes back "on the mainland", regardless of where you dine. Also remember to keep in mind that the exchange rate puts American visitors at another "disadvantage" when using USD. Prices at most restaurants are listed in local currency, Cayman Dollars, which exchange at a constant 25% premium to the U.S. Dollar (The CI$ is pegged to the USD at an exchange rate of $1.00 U.S. = $.80 CI; $1.00 CI = $1.25 U.S.). All in all, one can make the generalization that dining out is usually "not cheap" in Grand Cayman, but this article does a very good job of helping point out some of the less costly options, so make sure to take note and save a few bucks.
The best way to keep dining costs in check for those staying in lodgings with kitchens is to supplement dining out with eating in. The grocery stores on the island are very similar in layout and type of products carried as to those in the United States and Canada. Many also carry goods that would be familiar to those visitors from Britain and Asia. Take a short trip to the supermarket and load up on bagels, fruit, cereal, and everything you would normally eat at home. If you happen to be grocery shopping around lunchtime or dinnertime, you may notice many fellow shoppers "grazing" the prepared foods offering at the larger stores. The hot and cold prepared food at the supermarkets can be another great money saving option for those in the know. Almost all the grocery stores accept credit cards and traveler's cheques.
For those situated around George Town and Seven Mile Beach, the fisherman's market on the little beach next to Cayman Cabana Resto-Bar is a great place to get your own catch of the day (most fish are around $5-$8 U.S. per lb.) Guy Harvey's Grill in the harbour area features a CI$9.99/USD$12.50 dinner special each evening, the steak and frites on Thursday and Friday nights are especially popular.
While a couple can easily spend $75 U.S. dollars for breakfast at one of the island's favorite pastimes, a full-spread proper Sunday Brunch Buffet, you certainly do not need to. The Westin's regular breakest buffet (which includes: pastries, hot oatmeal, omelet station with many fillings, fresh fruit, cheeses, and hot plates of scrambled eggs, bacon, sausages, pancakes and fresh squeezed fruit juices) is $15 CI at the time of writing. Some places around Seven Mile Beach to consider for breakfast that would certainly cost you less than that would be Treats, Paperman's Coffee Shop, Cafe del Sol, ICOA fine Foods, and EATS Cafe (for an American diner style menu). If you stay at the Sunshine Suites Resort, you get a continental breakfast included in your room rate. You can upgrade to a hot breakfast buffet for $6.25/person. Having an economical, large breakfast, and then having lunch out of the fridge takes the sting out of those $150 U.S. dinners at some great 5-star dining establishments that you won't find as good anywhere else in the Caribbean!!!
Next, when eating out, eat like a local. Very few Caymanians or ex-pats will be eating at Blue every night. Other than the handful of fast food eateries around George Town and Seven Mile Beach, there are plenty of take-out /sit down options - pizza, and Chinese, Thai and Indian restaurants that are affordable. A popular spot for locals and tourists alike is Chicken! Chicken! for grilled chicken and side akin to a Boston Market. Al La Kebab has great gyro wraps (~$25/for two), and there is good ol' KFC, Burger King, Subway, Popeyes - yep, Grand Cayman has some fast food places from the mainland (~$15/for two). There are also numerous restaurants in and around George Town that cater to the local and ex-pat community serving Caribbean or other ethnic fare (Indian, Phillipino, Honduran, etc..) that are less expensive than the tourist focuses establishments. See the Cayman Good Taste link below and search for specific cuisines to find these hidden gems.
A great tool to help target your dining options is the Cayman Good Taste website which lists many of the island's restaurants and presents their menu and pricing information (Pricing is listed in the local currency). A search under local cuisine will yield many lower cost dining options. Many restaurants in the George Town and Seven Mile Beach area will also deliver; Fine Dine In is a local delivery service used by many establishments in the event you feel like staying in.
Caymanians also enjoy street food and this means Jerk Stands or BBQ Stands (many are cash only). While jerk stands are predominately located in the George Town - Seymour's and Bodden Town areas - Rankin's Jerk Pit , Grape Tree Cafe fish fry, Chester's Fish Fry and Woods' Jerk Stand, West Bay - Heritage Kitchen; BBQ options are usually available Thursdays - Saturdays along roadsides in the Seven Mile Beach, West Bay and Prospect areas of the island. Chef John's BBQ has three outposts: Crewe Rd. in George Town, Public Beach at Seven Mile Beach and up by the West Bay Public Beach which is managed by his daughter Norma Jean.
Since many visitors will be on vacation, a sit down dining experience is probably key to truly enjoying a visit. So if you are intent on skipping the many world-class dining options or your budget just won't allow for it, there is no need to go hungry. The following restaurants are nothing fancy, but popular among both locals and tourists, so expect a wait (many serve breakfast well): Sunshine Grill for casual fare like fish tacos and burgers, Tim Buc Tuu for eclectic Caribbean fare, Cimboco for Caribbean fare, and many other you can find on Cayman Good Taste or Trip Advisor's reviews using the filter by price option.
Finally, many establishments have promotions and discounts which help save some $$. Check out any of the local publications (found at the airport of other tourist areas like car rentals or retail stores) for money saving coupons or announcements for specials. Many bars and restaurants will have happy hour or other specials that can include free buffets or discount food items along with drink specials. Some to reference are: EXPLORE Cayman, What's Hot Cayman, eCay Online, and Wild Banana.
As the dining scene in Cayman is always changing, it's a good idea to ask in the Cayman Islands Forums for the most current information regarding where to eat. A guide and review of a few affordable options can be found here as well.