The hotel is worse than other budget hotels I have stayed in -- For US$40/night in Havana we expected something more than what we got --

1) The sheets and blankets were stained and they were not changed at all during our 4-night stay. (We hope the sheets were fresh when we checked in -- fingers crossed.)
2) Hot water was not available for 2 of the 4 nights we spent there but thankfully Havana was warm enough at that time for cold showers.
3) There was no water for 2 mornings.
4) The room smells like sewage.

The hotel is located in the deep downtown of Havana. It's really cheap (we paid around 25 euros per night in a double room) and the conditions are those which the price indicates. Some rooms have no hot water and people need to move to other rooms. The landscape in the breakfast terrace is fantastic. Dinner is not bad and is the cheapest we found in Havana.
Capitolio is only 10 min walking, as well as other nice locations.
About survivance in Havana, I advise to ask for a guide.

The Lido was among the cheapest hotels in Havana, which is why I went for it. And in its case you certainly get what you pay for. It was a bit grim. The bedroom looked grotty and the bathroom was the size of a closet. On the first night there was NO WATER and then it was cold for the next two days, but cold water's common for Cuban hotels. The reception staff were not very helpful generally and claimed that I had no booking for the third night, despite the fact that I had booked it online and had the print out with me. (Make sure you print out all your bookings before you get to Cuba because the hotels insist on seeing them, and NONE of the internet cafes allow you to print stuff out!!!) On the plus side, the Lido is within 5-10minute walk of most things you'd want to see in Havana, so if you're just looking for a place to sleep while you explore the city, it will do - but I think a casa particular would be a better bet. I stayed in a really nice one on my last night in Havana. It was half the price of one night at the Lido, and it was much more pleasant: bigger room, hot water, friendly hosts. So, if I had my time again in Havana, I wouldn't have bothered with the Lido. Wherever you stay, though, you'll love Havana. it's a really vibrant city and the people are very friendly - but they're always asking you to buy stuff from them or for them.

Choosing how many rating-circles to color above is kind of diffucult with this hotel. I gave it an above average rating but only because of the price. The thing is, that this is the cheapest hotel in Havana. I stayed there twice, and I like it, even though it is...um...not exactly a nice hotel. I paid $21 per night when I went alone and less that that when I went with a friend and we split the cost for a double with a balcony. The rooms with a balcony are worth the extra $$ as the room I had without a balcony felt a little prison like, not because of it's size but because of the lack of light. I am glad to hear that there is now hot water, as when I stayed there, there was not. I too, did not have a toilet seat, but this is common in Cuba and have since, become acostomed to it. The rooms are sparce but clean. They have a TV, phone and air conditioning. The front door to the hotel is locked at night but there is always someone right there to unlock it as soon as you get back from your night out. There is a small bar on the main level and as the other reviewer wrote, there is restaurant on the roof of the 6th floor. Well maybe restaurant isn't exactly the right word, but food is served. Also, I had an emergency situation where I had no money and needed to call home to the US and the woman at the front desk let me use the hotel phone to contact my family. It's not because they were worried about getting their money, as the room was already paid for, so I was very greatful for that. If I need a hotel in Havana again, I will definately stay here again. While in Cuba, don't worry about how nice your hotel room is, or is not, as you should be out experiencing all that Cuba has to offer and be spending as little time as possible in your hotel!