I love Munich and I am there at least once a year there!
If I do not stay with friends I stay in Motel One at the Sendlinger Tor. That's right hotel for young professionals with rooms from 69 Euro. The hotel is stylish, has free WLAN and breakfast included and is located in a quiet street in the center of the city with shops, restaurants and bars in front of the door.
From there you can walk to all the tourist attractions such as the Marienplatz, the Hofbrauhaus and the Viktualienmarkt as well as to the Central Station (800m) with a Ubahn and tram stations in front of the door. Visit the Glockenbachviertel with lots of bars, restaurants and boutiques while you are staying there! If you don't get a room there (as it is quite often booked out) try one of the other Motel One hotels in Munich. They are cheaper but not as central as this one.
Another good value compromise is the Hotel Royal with its delicious breakfast, free WLAN and friendly staff. It is close to the Central Station, Deutsches Theater, Stachus, Kaufinger Strasse and the Beer Fest but the area is not as nice.
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