Great digs in Principe Real... This was a great place to stay. It's on a pretty quiet street and has a lovely view of the city from the living area. It's on the third floor (fourth to Americans) so catches lovely breezes as well. It's a short walk (5 minutes) in either direction to a leafy park with a kiosk and great people watching, restaurants, etc. It's not in the middle of the action, but for me, that was perfect. Maybe 5-10 minutes away (on foot) you have all the action of the Bairro Alto. There are busses and trams just up the street that connect to other sections of the city.
Lisbon is a city of hills, so just be prepared for that.