There are couple of backbacker places in the old town actually. So thouse are quite low cost I think, all the other hotels in old town or near there are quite expensive because it’s all center city really. But just do a google search on Tallinn hotels youll probalbly get the result for all bigger hotels in center city and well then theres the backbackers option. Sorry I can’t help you more.

Old town tends to be the two extremes – either hostels or very nice and pricey hotels. Then again, November is low season so you might get a good deal. Merchant’s House and Domina City are nice hotels in the heart of old town. Don’t expect much Estonian flavor in either (but you’ll get all the flavor you need when you walk out of the hotel :)

I loved Villa Hortensia, a mid-range place right around the corner from the Old Town’s main square – Lonely Planet writes about it: ‘nestled into one of the Old Town’s most atmospheric courtyards is this small, irresistibly charming hotel. Most rooms are split level but tiny, with beds in a loft area under skylights opening onto Old Town roofs.’ The address is Vene tänav 6, the phone number 641 8017 504 6113. When you walk down ‘Vene’, look for the Café Chocolaterie – this charming cafe is located in the same courtyard – ask at the cafe… & enjoy!

The first time I was in Tallinn, I stayed in a Soviet-era hotel converted into a casino (didn’t gamble, but it was cheaper for the level of hotel since other people were gambling) and this was obviously outside the old town. The second time I was on a day trip from Helsinki.

However, for something like you’re describing, you should check out ricksteves.com, since that’s exactly the kind of place he recommends most often.