Yesterday, October 1st, I set out to book a hotel room for the Obama inauguration on January 19th. Everything in the District, Dupont Circle, Georgetown, and Foggy Bottom is booked. One call led to another and I did find a room in old Alexandria for $399 a night with free shuttle to the metro. I can cancel without penalty anytime up to January 15th (in case, well, you know).
There is nothing finer than being there on Inauguration Day. I went to the first Clinton inauguration -- a clear cold day, unforgettably happy. Can't recommend it highly enough. Other rooms are going for more like $600 a night that Sunday/Monday, but they're full. Heads up, folks.
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Another Option
Cheap & fun accommodation in DC
Reserve your Amtrak seats early, the train is so popular these days that even W is seeing the light: [WSJ] Bush to Sign Bill to Nearly Double Amtrak Funding
I've not checked availability, but there is an official AYH hostel less than one mile from the whitehouse ( http://www.hiwashingtondc.org/ ) and just over one mile from Amtrak's Union Station, but my favorite DC hostel is "Hilltop Hostel" (formerly "India House Too") up 5 miles in the north corner between Takoma Park and Walter Reid Hospital ( http://hosteldc.com/ ) right next to the Takoma Metro and bus stations. Compared to the AYH joint, Hilltop is much more bike friendly, has loaner bikes and hammocks in the backyard and is a likelier spot for engaging a nice chat with a mix of locals and foreign visitors over a bottle of whiskey and a midnight card game.
DC is also great for getting around on foot, bicycle or probably wheelchair too, especially on holidays. The streets are a well connected grid which evens out traffic flow nicely.
There is a lot of broken pavement though, so I'd recommend touring, not racing, tyres.
You can also camp within biking distance of Foggy Bottom along the C&O towpath. In January, there should be little competition for spots!