Jas & gracious, i think accomodation in St Kilda is alot cheaper.
Its relatively near town, & its well served by trams and buses.
Even if you were to park, the parking charges there are alot cheaper.
Sorry, i dun have any specific hotels / motels to recommend coz i stayed with relatives. But if u really must, Bayview in Melb city is quite affordable. 3* star hotel at abt A$130 per room per night. Located right smack in town.
Jas, you're welcome. Anytime!