My two sons (10 and 12), niece (16), husband and I stayed at the Salisbury Hotel during our summer vacation in NYC. Located across the street from Carnegie Hall on W. 57th Street, the Salisbury is a modest hotel -- no grand lobbies or fancy restaurants here -- but it is clean, affordable, and in a prime location. We had a one bedroom suite (two double beds) with a living room (complete with sofa bed) and kitchenette (fridge, microwave, and small sink), and it was plenty of room for all five of us. In fact, the rooms were really big, and there was a ton of closet space -- very unusual for NYC. The decor is dated (love that green carpet!), but the room was very clean, the air conditioners (one in each room) kept us nice and cool, and we couldn't hear people in the hallway or on either side of us.
You really can't ask for a better location than the Salisbury, which is two blocks from 5th Avenue, two blocks from Central Park (on the south side), a few blocks from Columbus Circle, a short walk to Times Square and Rockefeller Center, a block from the Rizzoli bookstore, and around the corner from two different subway lines. Also, both the Carnegie and Stage Delis are just down the street.
Every morning the hotel staff places a voucher under your door for breakfast ($6.50 per person) at the restaurant on the third floor. We ate there a few mornings, and the food was basic (cereal, breads, boiled eggs, waffles, bagels, juices, coffee) but good. However, we found a great little mom and pop diner (with some great 70's decor) around the corner called the Parisienne that was much better and had a great breakfast menu (and it was about the same price as the hotel breakfast), so I'd recommend that over the Salisbury.
Another restaurant recommendation is Angelo's, which is located two doors down from the hotel. Great food and decor and very reasonable prices. Also, if you're a "Seinfeld" fan, the real Soup Nazi guy has his restaurant a few blocks away on W. 55th Street.
Finally, the staff at the Salisbury are very friendly, knowledgeable and helpful. When we requested a cab to take us to the airport, the concierge surprised us with a limo (that actually cost less than a cab would have). Needless to say, the kiddos were thrilled to ride in style!
All in all, if you're looking for a no frills place to stay in the heart of the city, I would highly recommend The Salisbury.
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