It's over ten years since we went so can't say the information is current but as there is very little development allowed on the islands I don't suppose things have changed.
There's lots of self catering cottages that book up amazingly early because people just keep going back. Have a alook at
http://www.scillyonline.co.uk. for all types of accommodation.
Tresco and St Martins will be very expensive. I have to say that I didn't find anywhere was cheap - it's a supply and demand thing. Too many people chasing too few beds. St Marys is the main island with the most accommodation, by far.
Frankly there's not a great deal by way of organised entertainment - the boat club used to have things going on but it's a pretty chilled out, laid back type of holiday.
It's a fantastic place and I keep meaning to go back but there's so much to do and so little time...! We met people who go back every year - it's that kind of place. If you get the bug you just have to go back and I can understand how it happens. Great beaches and climate and just a very relaxed and easy feel to the place.
Hope you'll enjoy.