Prague is one of our favorite cities in Europe. Our only lodging experience is the Marriott, so can't offer much help there.
Some of the best food in Prague is at small restaurants at least two blocks away from Old Town Square (at about half the cost).
Public transportation is very good and you can travel at a fraction of the cost of London or Zurich. The Prague Castle is very popular, as is the Jewish Quarter. Lots of history and beautiful architecture everywhere. It is a great city to walk, with beautiful parks. The Charles bridge is also a main attraction for tourists.
There are very good walking tours that you can generally just join the morning of the day you want to go. Our experience with tour guides there has been exceptionally good. Most meet at the Clock Tower in the Square.