Lodging....hmm. Chartlottesville is 20 minutes away and is far and away the biggest town close to the festival...but I dont know about inexpensive nor availbility. There is plenty of good camping around but even these fill up for this weekend, as it really coincides with "opening day" even though we dont have an official opening day anymore. Im sorry, but I am just drawing a blank on that one. Staunton and other towns within 40 minutes should have availability at your typical Motel 8 type places, but thats all I can suggest.
Maybe try this: http://www.albemarleangler.com/links.html
These guys are a top notch fly shop in Charlottesville. They know the area way better than I, and can probably point you in the right direction.
I received your PM and will clear my schedule with "the boss" and give you a call!