All the recommendations below are for the town of Nyaung Shwe, which holds the vast majority of guesthouses and tourist services for Inle Lake.
Biggest Tip: have lots of patience or book ahead. I called 20 places from our guesthouse in Kalaw. The 20th had availability in our price range. The 10th had a room for 4x what Lonely Planet quoted. We ended up staying at the Good Will Hotel, a decent place with a leaky toilet, a bathroom big enough for our trek laundry, a nice veranda, and a breakfast that's been the worst so far (pretty much eggs, which meant nada for Lina). We paid $35/night for the first two nights. The third night I negotiated down to $30. All comparable places seemed to be the same price. The least we heard was $25/night for a double.
Eat and Drink
Pretty standard food at standard prices. Our favorite experience was eating at the Mingala Market. We went twice, each time opting for a variation of a Shan noodle dish. In addition to our main dish, we got a huge bowl of fresh guacamole and rice crackers, as well as pickled vegetables and fried onions.
The grand total for both of us: 1000K, or $1.25 US. The place has no name, just look for this lady (and her cute kid if it's not a school day):
See and Do
The lake, the lake, the lake, plus hot springs and a scenic bike ride. Check out our Inle Lake photo gallery to see what I mean. I never wanted to leave. Make sure you see Indein. It's like a mini Bagan smashed into a compact area on a big hill.
More Inle Lake
Have any tips for Inle Lake on a budget? Where did you end up staying? Let us know in the comments!