rufous:
Victor, thanks for the suggestion. Can you recommend something specific? Thailand/Malaysia is rather broad. Brian
I am more familliar with Malaysia than Thailand.
Malayisa the food is very cheap, you will struggle to spend $5 on a meal. Everything works in Malaysia, the mobile phone network even covers the islands (patchy). Busses and trains run on time, Driving outside the capital KL is easy as long as you don't mind driving on the UK side of the road. The people are very friendly, everyone speaks good English. Booze is the only thing that can be costly, $2 a bottle of beer, $10 for a bottle or wine, much less if you buy it in a supermarket.
Here are some sugestions
If you can manage a trip to Sipadan, world class diving, some of the best ever.
Unfortunatly not cheap these days. They have limited the number of divers allowed so you need a permit. For this reason I feel that you would need to book in advance if you wanted to dive there. Use google loads of resorts to choose from.
Perhentian (
http://www.pulauperhentian.com.my/perhentiankecil.php# )
This site shows you the resorts. Their prices are a bit high, I would normally expect to pay about Ringit 100 for a room with aircon, and a lot less for one with a fan.
An example is ABC Chalet Budget rooms are R40 or $11 per night. Now these are not posh rooms but as all you do is sleep in them so what.
Another option is Tioman, further south, (
http://www.myoutdoor.com/tiomanisland/index.htm )
Rooms are available in long houses for about R60 per night. Berjaya is a posh which was offering special deals last year at about R150 or $43 per night, and it is a posh resort.
I dived with B & J's last november when I went to Tioman, very friendly, more than happy to help out. If you email them they may be able to recommend a place to stay on your budget.
I know Thailand is cheaper than Malaysia but I have yet to visit it.
Loads of people here have so if you look up trip reports you will find some.