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Open-ended back-packing trip to Europe

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Hello all! I am new to this forum.
I have joined here to get help for planning my trip to Europe, tentatively sometimes in 2012 or 2013. I am 45 years old and live in Pune( Maharashtra, India).
My travel companions will be my wife and daughter( 10yrs old).
In India, a whole lot of tour operators organize trips to Europe from 7 - 20 days....for example, Thomas Cook, SOTC, Cox & Kings, Raj, etc. The advantage of travelling with them is obviously the absence of paper-work hassles and the group discounts that they get in big hotels and events abroad. These tours, I have learnt, are a bit hurried and I don't like travelling in hordes. Therefore, I have decided to organize the trip on my own, that is, we shall be like lone-rangers.....a back-packing family.......travelling on our own time-line and yet planning the budget very carefully.
Our trip will be ideally of 25 days and we are planning to stay in farm-houses and private bed/breakfast lodges, in small towns near the big cities, so that we can save on the expenses of staying in luxury hotels. I am in the process of making a rough itinerary and working out a route accordingly.
Tentatively, our destinations en-route include London, Windermere, Edinburgh( all in UK), Brussels, Bruges( all in Belgium), Paris(France), Amsterdam( Holland), Munich, Berlin, Heidelberg, Frankfurt( all in Germany), Vienna, Innsbruck, Salzburg( all in Austria), Budapest( Hungary), Schaffhausen, Berne, Zurich, Geneva, Interlaken, Lucerne( all in Switzerland), Rome, Milan, Venice, Florence, Pisa( all in Italy) and Prague( Czech Republic). My wish-list also includes Barcelona in Spain and Copenhagen in Denmark. One is in too south of my normal route and the other is a bit too north.
To save costs, I am also considering staying in one central place and covering the other destinations, travelling to and fro, etc.
My total budget will be around 7500 Euros( plus/minus another 10%) for all 3 of us.
Please feel free to give me advice and suggestions and build up my detailed itinerary day to day.
As I detail out my itinerary day by day, with your help, I shall keep this Message updated. I need your tips and guidance for this. Thanks in advance...and wish you all bon-voyage.

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