We stayed at a ryokan in Kyoto, it was more than a hostel (I didn't even look into that option at the time), but not horrendous and a very pleasant experience. Don't have the name handy, but there should be info out there - especially if you can read Japanese. We stayed at a hostel in Hakodate, which was terrific, so if you can find one, I'm sure you will be satisfied, just may not have many options. My mother-in-law still has my Japan travel guide, so I don't have resources to hand to help, I'm afraid!