yorkshire

I don't know if flights would be any cheaper, but when I read your post, Quebec popped into my head. No, not Europe but with a European feel and less hot/humid climate.
I am having trouble finding flights for close to $1000 for MAY, so I know you are struggling with August. I plug all of my potential destinations into a Kayak fare alert. I also periodically check the websites of the airlines that fly out of my closest intl airport, as sometimes a sale will appear there and not make it onto the consolidator websites. For example, Austrian Air sometimes has decent fares to some of the places mentioned in this thread.
good luck!

Sidny

Once you figure out where you want to go you could look at doing a package on Orbitz, but to be honest I'm not sure you get such a savings that it's worth being locked into. You might want to pick the destination, get the best price on airfare you can (probably sooner rather than later), then spend some time researching and deciding how you want to spend your time and if you want to stay in the same hotel/city the whole time. Also, if you want to save on hotels and don't mind budget travel you might look at hostels (they're not just for young kids anymore and often have private room options).

Try kayak.com for airfare searches. Venere.com is good for searching European hotels. Of those you mentioned above, Prague is probably most budget friendly--though you can find good deals most places. Plan to picnic for meals...restaurants get expensive. A good guide book will give you a ton of practical info to help you start planning (I actually like the Rick Steves books for first time travelers).