Staying in Vegas really depends on what you plan to do while you're there. If you want to see as many hotel-casinos in the shortest walking distance possible, stay center-Strip. If cost is a major concern and you only need a place to shower and sleep, look for Best Westerns, etc., a little off the strip. I don't gamble, so I base my decision on the pool and/or nightclub.
Imperial Palace is usually the cheapest you'll find center-Strip. But it IS a dive. Other relatively inexpensive and centrally located are: Paris, Alladin - fairly new (refurbished) and Flamingo Hilton - nice pool
Luxor and Excaliber are usually cheaper than most but they're near the end of the Strip, next to Mandalay Bay
My favorite places to stay have awesome pools and nightclubs, but are usually cost a lot more: Mandalay Bay, and the Hard Rock. I also hear the Palms is a very hip spot.