How long are you going to be there? When I went for a week a couple of years ago we just booked the first two nights in a reasonable looking place called the Euphemia. It's not that cheap but it's not expensive, either.
http://www.hostels.com/en/availabili...stelNumber.647
After that we moved around. There are lots of places between the red light district and centrum, most of them not expensive. I think the one we stayed in on the last night was called Centrum hotel, in fact. Wasn't exactly the nicest of hotels but it seemed clean enough, very cheap though.
You'll find the nicer places to smoke/drink are outside the leidersplein, anyway, so I wouldn't bother staying there. It's not far to walk, regardless.