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Small town near Grenada?

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My wife and I will be traveling to Spain in mid-October. We're flying into Madrid and will heading out (in a rental car) to the Grenada area for our first stop. Our plan is to spend three nights in the area (I've already booked tickets for Alhambra).

While I originally was planned to spend three nights actually in Grenada, we decided to stay outside of the city. This was so we could spend a day or so in the countryside (likely go hiking in Sierra Nevada) and explore a bit (we like cities, but feel we get a different feel for a country and relax more when we're away from them).

So, we're looking for recommendations of a smaller town/village somewhere close enough to Grenada to allow us to explore but outside the 'hustle and bustle'. Luxury accomodations are not a requirement... a small hotel, inn, bed and breakfast will more more than suffice for us.

Thanks in advance!

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