Does anyone have experience with inter europe airlines?. I am currently looking at Vueling for Madrid-Rome and Air Berlin for Rome-Cologne. Opinions? Sugestions? .

Plenty of people have flown Vueling and Air Berlin before. Do a search on both (select Europe forum). I flew Vueling last year and had no problmes at all. Their luggage rules tend to be more strict, so make sure you read all the rules before proceeding. For example, Vueling's rule on carryon size/weight is very low, and they charge a fee for checked luggage. However, the checked luggage fee is much lower if you purchase it at the same time you book your ticket. If you don't and show up at the airport with a suitcase that needs to be checked, the fee at airport is much higher.

I flew Air Berlin within Germany about 6 months ago. They are strict, but I thought it was fine, and most of my flights were pretty much on time....

I've taken them both. Vueling was very good for a discount airline. I'd have no qualms taking them again.

I've flown on Vueling and would definitely recommend them. Their planes are clean, the staff was polite, and they were pretty efficient overall.

airberlin is Germany's 2nd largest carrier with 28m passengers per year, and service-related in between a fully-fledged "real" airline and the budget airlines.
The intra-European services are one class only. You don't pay extra for luggage (20kg max), check-in deadlines are quite relaxed (40-60min, depending on airport), get assigned seats, online check-in w/ seat selection without fee, food/snacks, drinks, newspapers are free, and many planes have a bit of IFE (just overhead monitors for cartoons or flight informations, but they usually don't sell headphones on those short hops).
Changing flight dates or hours will incur sometimes hefty surcharges, if for example you got a cheap fare booked early but later only a higher fare is available.