I currently have the Lake Hotel room and was wondering if it is worth doing the Annex to save a little $$. If anyone has stayed at either, I would greatly appreciate yor feedback,

I stayed one night with their Lakeview(expensive)room. While nice and good view, I would have rather been able to save some $$. It was all they had. Most National Park lodging is pretty rustic anyway, so don't expect anything to grand.

There will be renovated Lake Hotel rooms available in summer 2013; unless that's important to you (and you have one of those), I'd save the money and go with the annex. You can enjoy the lobby, views, and dining of the hotel; the annex is a little set back in trees, and more private, we thought.

I was thinking that I would prefer just to save the money since this is not THAT type of vacation. I have stayed at Yavapai at Grand Canyon and that was fine. A clean room with a descent bed is all I ask for, I am not expecting luxery or "heavenly beds". But we stayed at a four star in New York city over Christmas for the price of the Lake Hotel so it is hard to justify it unless it was much nicer than the others. I might also keep calling to see if my room at OFI can be changed also to save a few bucks. Any experience with the lodging at OFI?

I have stayed in the Old House Rooms (or whatever they call them) without a private bath. Those are fairly inexpensive. They do have a sink in the room. Myself and daughter actually like this type thing. My wife absolutely refuses to go without a bathroom in the room.

There's also some newer lodging at OF (Snow Lodge), but IMO, the area has a zoo atmosphere (cars and people) outside. The old (Inn) rooms (shared bathrooms) let in a lot of noise.
Plus, the view/scenery around the lake (and from the restaurant or bar) is just beautiful.
The Lake Lodge cabins (Pioneer $79) are probably the best deal for the budget minded.
http://www.usparklodging.com/yellowstone/lake_lodge.php

It is a Zoo atmosphere during the day. But is quiet mornings and evenings. I woke up twice to see Old Faithful go at 6:00AM. Both times it was just myself and one or two other people. Expect 1000+ for eruptions during the day. Plus OF Inn is just spectacular.

Not only is it quiet early and late but if you walk thru the boardwalks in the upper basin the number of people drops off substantially.