It's worth looking around at specials. We went to Sydney for 5 nights and stayed in 3 places.
1st night stayed at Shangri La at the Rocks, we payed $240 per night with an opera house view room, the room was fantastic, marble bathroom and massive.
We then had to go to Cronulla for a birthday party, payed $160 per night, the room was very old, and cold (middle of winter), rubbish view and no breakfast.
Final nights we stopped at Novotel Rockford, again it was around $150 per night, it wasn't bad, probably as good as a travelodge and again no breakfast.
I know that $240 per night is stretching most peoples budget, but you got so much extra for your money, and that was booked through the entertainment card.
Best value I've stopped at in Sydney was Four Seasons Sheraton at Darling Harbour, got lucky with a harbour view room, and it was approx $140 per night, but I had signed up to their specials.
Sign up to "whatif" and see what they have, I recently stopped at the grand down glenelg for $100 including parking and breaky.