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Europe trip. Help building itinerary

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Hello. I have book a 40 day trip to Europe that will begin in Istanbul and end in Amsterdam. What I will see along the way remains to be planned. I have about $3500 I wish to spend, but willing to go as high as $4000. I want to live cheaply, and have some family that I can visit and stay with here and there.

I will be in Istanbul for about 6 days, and then headed to Rome, and then head north, maybe visit Venice (have family). From there I wish to go to Germany, see perhaps Munich and Berlin, and then move to Amsterdam.

For those who have made similar trips:
1) What are recommended forms of transport that are easiest?
2) How long were these commutes?
3) Advice on living cheaply, and what to see?

Thanks a lot in advance, guys!

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