Prague. Gorgeous, not expensive, friendly people. I've walked and walked there. Last time, we rented a big room w/kitchen right in the center of the city for a weekend, for a reasonable price. My number one suggestion.
Salzburg is also beautiful, but I was touring with an orchestra and as a result not able to remember much about how much it cost (hotels were booked for me, eating expenses covered etc). I walked around in Mozart's apartment, touching door handles and looking out windows, thinking "Mozart touched these door knobs" and "Mozart saw more or less this same view when he looked out this window".
I thought Vienna was sterile, and the people not friendly. But I've only been there a couple times for short visits. If you're into classical music, though, try to go to a concert at Musikverein.
Beautiful hall.
I don't remember one single person smiling in Switzerland. But that was in 1991, maybe they've cheered up since then!
Paris is of course amazing in so many ways, but a bit expensive. I had some wonderful meals there. After hearing for so many years that Parisians are arrogant when foreigners try to speak French, I was pleasantly surprised that my attempts at sentences here and there were always met with polite replies spoken in clear French slow enough even for me to understand. The nice lady in the drugstore even went so far as to smile and have a short conversation with me in slow French.
I've been told that Budapest is great, but haven't been there myself.
Oh - and Copenhagen is just great. Have been there many times (it's super close to where I am). It's pretty and friendly. Great atmosphere. Helsinki and Stockholm are wonderful as well, but farther away from central Europe, and more expensive. Sadly I can't recommend my own city, Oslo, and Norway, despite the fact that the nature is amazing. It's just too expensive :-(
Regardless of where you go, be safe and have a GREAT time!
