Mingood Hotel, rm100.  Good location in town.

Georgetown not that big, so long the hotel is within the town, it's easy to get around.

The other one is Oriental Hotel, this one the room looks a bit old but ok la, also around RM100 nia.

Or if you don't mind, can stay at the guesthouse.  One good one is Hutton Lodge, single room with attached bathroom, RM 65 only.  http://www.huttonlodge.com

For Penang hotels:
http://www.penanghotels.com.my/

Some people go for Tune Hotel coz it's new - new bed etc.  But I don't think it's cheap after all the add-ons like bath towel, air-cond etc.  And the room is small.

Would probably cost you the same or more than the bus fare (x1 pax) from KL to Penang.  I estimate RM30 at least, now not sure coz of the recent price hike.  Same as KL taxis, Penang taxis also do not run on meters. 

By the way, from downtown to Gurney Hotel, RM12-15.  So, in fact, can take bus to Butterworth, take the ferry across(RM1.20) and take taxi from ferry termina(Weld Quay)l to Gurney hotel.

it will cost u a bomb. but if under company can claim then nvm. at least RM40 my estimation. the rapid pg bus is another option but it is not reliable. sometimes need to wait for at least 30mins-1hr. but total cost less than RM5/person.

i like the bath room in gurney hotel.. so is the bed...

but was scary sleep along in such a bed room... end up on the TV whole nite...