My wife and I just got back from Prague (5 nights) and Cesky Krumlov. We stayed at Sir Toby's hostel in Prague and Hostel 99 in Cesky. We stayed in double rooms with in suite baths for roughly $50 per night. The Bueno room in Sir Toby's is excellent, nice bed, quiet, and clean. The Room in Cesky was along the river, but the bed wasn't so great.

Try to avoid eating in Prague's old square. We ate at Czech restaurants around Sir Toby's and they were great. Dinner for 2 with two beers each was about $25 to $30.

If you go to Cesky Krumlov (and I recommend it highly) take the bus and book it in advance. We took trains both way and it was all good...except for having to transfer to and from a bus to bypass construction.

You might want to consider going to Kunta Hora. It isn't everyday that you can see thousands of bones on display in a couple hundred year old church. It is an hour by train...at least it is supposed to be. The return trip's train was 1.5 hours late.

Re clothes and the weather- I gotta say that it was pretty chilly (we were in the Czech Rep Sep1 to Sep 8). I only wore my tevas once, and I can handle chilly weather.

Re beer- I was a big fan of Pilsner Urquell, but I thought that it was pretty weak compared to Gambrinus and some others.