I enjoyed the Posada La Merced. It is located, of course, near El Merced church, which is a part of town I was familiar with and liked. I got a wonderful room that faced a quiet courtyard. The bed was extremely comfortable, with extra pillows and clean, nice-looking bedding. The furniture was ample and of good quality. The room's wall color, bedding, and furnishings all went well together. I spent $18 a night and felt I should have been paying more considering the quality of the room. The bathroom was spotless and included nice touches, like a tiled floor and an oversized shower with plenty of hot water. I spent 4 nights at the hotel, and although I was rather sick during my stay, the staff was patient and helpful. I never heard a word from them, even though I took long showers at all hours when I couldn't sleep. I appreciated their friendly service and plan to go back.
As planned I went back to Posada La Merced in March 2005. This time I stayed in a single room (Room #34). It was on the 3rd floor with a view of Antiguan rooftops and was charming in appearance and comfort. I met the hotel owner Gail, who was very nice and remembered me through our back-and-forth emails. Over email, I was quoted anywhere between US$21.50 and US$48.80 for a double room. I couldn't figure out why there was such a difference in the prices so I finally settled on two single rooms for myself and my father at US$16/night apiece. Our bathrooms were ridiculously small but clean. Bottled water is provided, and there are fans in each room.
Here's their website (with lots of photos):
Posada La Merced WebsiteOr you can email posadalamerced@hotmail.com