1: Why not try the Hump Hostel or Lost Garden guest house? You can rent a private room with separate private toilet in these places for as little as 80RMB per night.
2: You can use your bank card as long as it's VISA or Mastercard in many of the ATM's that display these two logos (usually... but keep in mind this is China and things rarely turn out the way you expect so don't rely on it that you can...) I've had very few problems with my UK VISA debit card.

EDIT: Or a serviced apartment may be a better option!
www.gokunming.com/[...]

Ah, vinegar? Good to know! I'll ask next time!

My friend got a decent place this afternoon on Renmin Zhong Lu for 1000p/m. A little more than he wanted to spend and he ended up going through an agent, but he was in a hurry, so yeah... The agent said it was okay to pay half the fee this month and half next month, so that was helpful and it's a great location (only ten minutes walk) for his work. : )

I'll be checking out your suggestions for me as I need to move in the next couple weeks. Please list any other areas you know of as I have some time to check them all out carefully.

Thanks so much guys! Saw some cheap places in Huangtupo and tbh a loft sounds awesome! I think it's just too far for my needs.
I'll check out the other roads you suggested! : )
@Alien Fengningxiaoqu sounds perfect!

@Alien: Sorry, by 'lifestyle similar to home' I meant I won't drop my standards, If I wanna eat out at a fancy restaurant, or if I need a new laptop.. I'll do it, that kind of thing. Lifestyles are 'different' of course.