I'd go for the car and a less expensive vacation elsewhere... Maybe Australia? You can plan a Sydney/Melbourne trip by yourself which saves lot. You can hire local tour companies to let you see the sites, especially in Sydney. In Melbourne, you can use a tourist guide map and a week pass for the city tram to get around to most of the sights to see.

Getting from Sydney to Melbourne can be solved by Virgin Air... online reservation and kiosk-based express check-in when you get to the airport.

Hotel? Best Western hotels offer good rates. Try checking online sites which offer discounted rates for certain dates.