In terms of size Scotland has just the two cities - Glasgow with a population of around 800,000 and Edinburgh which has a population of around 450,000.
Edinburgh is the capital of Scotland and is a very beautiful, historic and interesting city with much to see and do there.
Although only 40 miles apart from each other Edinburgh and Glasgow are a city of two contrasts. Edinburgh has the lowest crime rate of any UK city and Glasgow has the highest apart from London, lots of people retire or move to Edinburgh for the quality of life whereas lots of people move out of Glasgow to improve their quality of life.
That said, there are places in Glasgow that as a tourist, are worth a visit.
This is a good site for visitors to Scotland... http://www.visitscotland.com/
This site is specifically for Edinburgh...
http://www.edinburgh.org/
And this one is for Glasgow...
http://www.seeglasgow.com/
Most people who live in Scotland do so in the 'Central Belt' - the low lying area of land that spans central Scotland, Edinburgh is to the east and Glasgow to the west.
Much of the remainder of the population live in towns close to Glasgow such as Kilmarnock and Ayr or on the eastern seaboard in places like Dundee or Aberdeen. To my mind these are all places that hold no great attraction.
A handy tip - if you're coming from the US don't make the mistake that many make when calling Edinburgh 'edin-burj', it's pronounced 'edin-burra' - the locals don't like it. It's be like us Brits referring to Howston or Milwakky.
The real beauty of Scotland is to be found in the Highlands and Grampians - the principal towns of which are Fort William, Inverness and Aviemore. These areas along with the islands such as Skye and Mull are where the true history and beauty of Scotland lies. It's here that you'll discover the story of 'Bonnie Prince Charlie' and the '45 (the Jacobite Rebellion), the decisive Battle of Culloden (1746) in which the English finally defeated the Scottish, the sad tale of the Glencoe Massacre (1692) and the sorry affair that was the Highland Clearances (use search engines to find more about these historic episodes).
It's these same areas that have the most outstanding scenery in the UK including all the highest summits, the largest lochs (lakes) and wide expanses of open-ness. You can walk for days without crossing a single road. The walk between Fort William and Dalwhinnie being a popular route that crosses nothing more than a single rail line. Or you can lose yourself amongst the peaks of Knoydart, an area not penetrated by road or rail and often referred to as Britain’s last Great Wilderness.
If time permits then get out to some of the islands - be it the Hebrides, Orkneys or Shetland Islands, they're all worth a visit.
My recommendation would be to spend some time in Edinburgh and use it as a base to explore the local area and for daytrips to Glasgow, Stirling, Perth and the Scottish Borders (southern Scotland). Move northwards after a while and base yourself somewhere in the Highlands, there's loads of small towns and villages providing accommodation. From here you can explore the beauty and history of Scotland.
As for which Hotels or B and B's to stay in - there's no shortage and the links above will give you plenty of ideas. Price wise you're looking at $100 to $200 a night in a decent hotel in the major cities, $60 to $100 a night for a reasonable hotel in the smaller towns and villages, $40 to $60 per night in a typical B and B and $15 to $20 a night in a hostel.
Hope this is of use to you and have a great time in Scotland - you'll love the place.