Stayed a night here, paying 40 euros for a single-use double room. The room was spacious and it also had a large patio to be shared with a room next door. The decoration was simple and basic, but I did not have any expectation and it was fine. The room had air-con, fridge, and TV.
The hotel does not have breakfast facility, but being so centrally located, I did not have any problem in going out to eat out or to buy something to eat in the patio.
The guy at the reception was helpful and answered to all my questions (which were not few!)
In the morning I was woke up early by the church bell (the hotel is very close to the cathedral church). It might be annoying to people who want to enjoy morning sleep.
If you go there, try also the taverna Lulus in front, recommended by the receptionist. It is cheap, friendly and tasty.

We have just returned from 4 nights in Hydra. We stayed at the Kirki Hotel. I wish we could have stayed longer. The location was perfect - less that 1 minute from the port. The proprietors were extremely helpful in directing us to the beaches as well as some tasty eateries. The rooms were lovely, simply furnished and very clean.
The garden in the back yard was extremely beautiful.
We will plan on returning as soon as we can.

Stayed for 2 nights (weekend). The location is extremely convenient, zero steps to climb and within 3 minutes from where the boat(s) drop you off. Unfortunately, this pretty much concludes the good part.

We asked and received a bed-for-two, i.e, single mattress (not two mattresses joined together). Unfortunately, the bed/mattress was very short (I am 178cm (5' 10")) and could hardly fit and of poor quality (my girlfriend woke up with serious back pain, and I had poor rest (kept turning)).

There room had a (tiny) balcony from which there is no view, i.e., you can see the buildings across the street and the rooftops, but no view of the water.

We were right above a right busy restaurant which also seems a locals' hangout. This meant A LOT of noise (and this was April). On the plus side, double-pane glass has been installed in the doors leading to the balcony and they are extremely effective. But since these doors are the only source of air into the room, closing them made the air rather stifling. (The bathroom has no ventilation.)

We are both rather light-sensitive in our sleep and this was another issue. As many places in Greece, the shutters are in the French style, letting in a lot of light (which is nice), but unfortunately the drapes are extremely shear. So, basically, at 8am of the first morning there, we both woke up as there was enough light to read comfortably. The second night we draped the extra blanket in the room and that worked.

Finally, during our stay (2 nights), no service person entered the room. We didn't expect a linen change, but some fresh towels would have been nice (and perhaps a mopping of the floor). Especially, the one for one's feet (exiting the shower) remained a soggy mess the whole time as the bathroom has no ventilation.

My friend and I decided last minute to stay over in Hydra as it was such a lovely place. We spotted this little place just off the port and lucky for us there was a room. The receptionist offered to show us the room before we committed (A good sign). The room was small but not cramped and most importantly, was spotless! Our room had a varandah which overlooked the cobbled street. The staff were helpful and very friendly and made us feel very welcome. Very cosy and relaxing. I am planning to go back this year and will definately book in at the Kirki. Great value for money as well.