We have stayed in three different places in Hallstatt:

1) Seehotel Gruner Baum - located on the marketsquare next to the lake. Good restaurant, but higher end as far as rates.
http://www.gruenerbaum.cc/

2) Hotel Zauner - also on the marketsquare but not on the lake. Some rooms do have lake views, however. Also has a good restaurant and rooms are less than the Gruner Baum.
http://zauner.hallstatt.net/index.php?lang=en

3) Gasthof Simony - located on the lake and marketsquare next to the Gruner Baum. Creeky floors but charming in a shabby chic sort of way. Cheapest of the three.
http://www.gasthof-simony.at/

The Gruner Baum and Gasthof Simony both have lakeside rooms with balconies.

We always loved the Gruner Baum, but sometimes their customer service leaves a lot to be desired.

The Hotel Zauner is a great hotel if you don't mind not being on the lake.

And the Gasthof Simony is fine altho the towels were a little tattered and you won't find any "extras" there. But they did have a lovely breakfast.

Thanks Betty for the suggestions. I think we may have to take what we can get, at this late stage. I will try contacting some hotels shortly. We leave at the end of June so it's not far away. Wish me luck!!
Kay

Although Salzburg can't really be considered a big city - I usually stay in the nearby village of Anif which is a few minutes bus ride away.

The Schlosswirt is a very nice hotel with a great restaurant.

http://www.schlosswirt-anif.com/