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Question 1: yes
Question 2: You'll have to pay in euros, so please change your, to me unknown, dollars into euros. Have a look here http://www.toprural.co.uk/ for b+b's.
Question 3: I don't know what your interests are, so can not indicate any must-sees or -dos
Question 4: I don't know, but check with SNCF-website (SNCF is the french railroad-company)

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1) Yes it is nicer - Bordeaux is not that wonderful a city, and yes it's driveable - circa 3 hrs depending on where in the dordogne you wanna go. However, assuming you're still based in NYC (based on your posting history), you may find it cheaper to fly into Paris CDG and then get a TGV down to Bordeaux. Refer to http://www.seat61.com for the train info, but it would be a damn sight quicker than driving down.
2) Pass
3) The Lascaux caves for sure, and there's lots of castles.
4) Fairl easyy; you'd have to go back to Bordeaux to get a TGV on to Irun (4 hr 30 from Perigueux to Irun as a random Dordogne town example), but the connection from Irun to San Sebastien is a really long wait, so I'd use alternative transportation than wait nearly 2 hrs for a 10 min train ride for the remaining 8km. http://www.bahn.co.uk will give you the idea (Europe wide train timetable search engine).

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Thank you both for your quick responses.
@Liberat: We are interested in good food/markets, light hiking, bike riding, nothing too touristy, not really museum folks either. We'd like to relax in the country. Really just exploring old towns/castles/sights. The nightly rate we are aiming for is approx. 165 euros or less.

@Fwoggie: We are still based in NYC, but we are using airline miles and as such probably wouldn't take the train from Paris. Thanks for your advice re: train to San Seb. I see you can take a local train from Hendaye--Euskotren--so that may be the better option.

Any suggestions on the best town to stay in/around in Dordogne, considering our interests described above? Somewhere centrally located that is good to use as a 'base-camp' of sorts?

Thanks!

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Sarlat is one of the main towns in the Dordogne area, and is picture postcard picturesque. It has some great restaurants too, but the traffic can get hideous, so it might be better to stay somewhere else and visit.

Domme is high above the river with fantastic views. La Roque Gageac and Beynac-et-Cazenac are built into the cliffs beside the river and would also be decent locations. I can't recommend any hotels in your particular price range, but Michelin will generally guide you quite well, and I've always found anywhere recommended in Sawdays to be superb. I can recommend canoeing along the river for a day, it's simply a glorious experience (there's a couple of canoe hire places in Cénac-et-Saint-Julien, just at the bottom of the hill that Domme is on).

The food in the area is all glorious, assuming you're not a vegetarian that is...

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Here is a listing by an organization which calls itself "The most Beautiful Villages of France." There are 36 villages in the Perigord - Southwest. It is a non-profit association, and one of the qualifications is that these rather tiny villages retain their essentially rural character. I have visited some of these, and they are always very interesting sites with unique architecture.

http://www.les-plus-beaux-villages-de-france.org/en

Domme and La Roque-Gageac are quite well-known. Get yourself a good map-book to tour around by car.

Not many tourists stick to the Bordeaux area unless it is to visit famous vineyards. Even then, you have to be REALLY into it.

Some people think the Lot is the most beautiful department of France. More info:

http://www.tourisme-lot.com/en

"we are open to renting a car" - You will NEED a car.

Here is a very nice place right next to St Cirq-Lapopie with rates that fit your needs:

http://www.hotel-lesaintcirq.com/

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Hi Mewood24
I'm the author of both the southwest France sections of the France book and the Basque (and around) regions of the Spain book and am based on the border fo the two countries. You say that wine is important to you for this holiday and so i wonder if you've considered skipping the Bordeaux region and looking instead around La Rioja and Navarra in north Spain? The wine areas around Bordeaux are, how shall I put this, a little closed off in comparison to their Spanish cousins. For example in France you basically have to take an organised guided tour through Bordeaux tourist office or a regional tourist office in order to see anything. In Spain by contrast everything is much more open and easy plus they have put a lot more effort into the whole wine tourism thing - there area number of fantastic and very interesting wine museums whereas there's absolutley nothing like this in France. Many of the numerous bodegas have set opening hours for visitors (at least in high season) which again is rare in France and in Spain you can sign up to all manner of wine related courses (though you can also do this in France). I personally would always recomend the Spanish wine areas over the French ones as it's just easier. the wine areas of La Rioja and Navarra are about an hours drive from San Sebastian.

In answer to your question about trains it's true that you have to change trains in Irun or Hendaye (I think the track is a different gauge or something) but there are frequent local trains every 20 min or so which will run you on into San Seb so no, you don't have to wait hours for a train.

Bordeaux is good for food and is an attractive place but in reality there isn't that much to see and do in the city itself. San Sebastian is fabulous but at that time of year book accommodation in advance - now isn't too soon. It's a very, very popular city.

Hope that helps
Stuart

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Thank you all so much for your feedback! We decided to fly into Bordeaux and stay 1 night (necessary--our flight doesn't come in until late evening), and then drive to Dordogne and stay 4 nights in La Roque Gageac while renting a car to explore the area.

@Stuartbutler you read my mind re: wine in Spain! I have recently started researching places to visit close to San Seb! We weren't planning to have a car in Spain so it will have to be either a guided trip or easily accessible via train. Any suggestions welcome. I'll also browse the Spain boards.

We've booked our hotels and flights and now it's just details to work out!

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Congratulations, I'm sure you'll have a fantastic time. I just wanted to reiterate - you must spend a day (or half a day, but it's nice to take your time) canoeing down the river. It's one of those occasions that will live with you for ever...

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Agree with all previous posters that the Dordogne is the way to go. If you can book ahead, it is really worthwhile check out a cave or two. We checked out Font-de-Gaume (http://en.wikipedia.org/wiki/Font-de-Gaume) which has 14,000-year old paintings including a cool hand stencil. It is a pretty incredible experience to witness that kind of history first hand. There are a number of outstanding show caves as well including Gouffre de Promeysseac and the unsurpassable Gouffre de Padirac - where you can go by boat on an underground river through some incredible caves - really memorable. It is near Rocamadour and both are also doable in a day trip if you are based at Domme or Sarlat. There are also the incredible castles of Castelnaud and Beynac to explore - even if you don't think you are the type to enjoy castles these will still amaze you. We didn't make it canoeing down the river as the water levels were very high (June 2011) but we took a gabarre trip and that was fun too (canoe would be better though). The food is fantastic all over - loads of duck confit and foie gras, and patisseries to die for! Lots of good market days too. I loved the Dordogne becasue of the variety of activities available. We only stayed a week - and with kids, so our itinerary was geared to their interests as well, but we all ended having the greatest time.