How many people are you with? If it's a decent group you could consider hiring a villa for the time being, this would give you all the space in the world you'd need.
If you really want a hotel in the middle of the partying zone of Kuta for a decent price, you could a hotel i stayed in for about a week before i moved off to Seminyak. Let me look it up for you.
Found it:
It was the Matahari Beach Bungalow where we stayed. It was literally ON the partystreet in Kuta, about a 5 minute walk to the clubs and great, cheap restaurants everywhere. Prices are about 45bucks a night so very doable!
Website: http://www.mataharibungalows.com/rates.html
Just telling you this because i absolutely love Bali.
Oh, and i spent over 2 months in Bali, and haven't encountered even 1 ladyboy (as far as i know), don't worry about them.
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